• Tue. Jun 22nd, 2021

    Financial independence

    Your journey to Financial Independence

    Insurance terms are often tough for many to understand as it is a technical matter and a legal contract.  In addition, the terms and conditions of insurance contracts and insurance-related terminology make it more complicated for the general public.  This is often an obstacle to bringing up knowledge about insurance.  In order to make informed decisions, you can get acquainted with the most commonly used health insurance terms.

     Co-payment

     Co-payment refers to the choice of sharing a predetermined portion of the claim amount between the insured and the insurer.  This option helps to decrease the premium when buying a health plan.  The co-payment method reduces the insurer’s liability as the insured person agrees to pay one percent of the total claim amount.  For example, if you decide to a 20% co-payment, you will have to pay Rs. 20,000 (20% of Rs. 100,000) yourself in the event of a claim of Rupees.

     Deductable

     Deductible refers to a certain amount that the insured person has to bear.  All policies have a portion that is manually deductible.  This agreement eliminates a portion of the insurer’s liability and enables reduce premiums.  The greater the deductible, the shorter the premium.  For example, if you have opted for a deductible of Rs 10,000 in your policy, you will have to pay the first Rs 10,000 when there is a claim of Rs 100,000 and the insured will pay the remaining Rs 90,000.  If the claim amount is less than Rs.10,000, the full cost should be accepted by the customer.

     Day care treatment

     This refers to medical treatments or surgeries performed in a hospital or day care center for less than 24 hours under general or local anesthesia.  It is crucial to note that outpatient treatments are not included in day care treatment.  Typical day care treatments include cataract surgery, coronary angiography, chemotherapy, and dialysis.  You can request a complete list of day care procedures from your insurer, which is also available on the IRDA website.

     Cumulative Bonus (CB)

     Every year without a claim, you are entitled to a higher sum insured without an increase in premium.  If there is no claim in the first year, insurance coverage will increase by 5% next year, and for subsequent non-claim renewals it will increase by an average of 10%, up from a maximum of 50%.

     Medical expenses incurred before and after admission to the hospital

     Pre-hospitalization medical expenses are the costs became liable before admission to the hospital, such as diagnostic tests and consultations.  These same expenses after leaving the hospital are called post-hospitalization medical expenses.  These include follow-up medications, tests, physiotherapy exercises, dialysis, and chemotherapy.

     Personal Accident

     Personal Accident policies are benefit policies that pay a lump sum in the event of disability or death in connection with an accident.

     Permanent Total Disability (PTD)

     Claims are defined as claims that happen when the insured person is unable to carry out his or her job responsibilities, or is unable to find employment of a similar nature due to an incurable or permanent disability such as amputation of limbs or loss of vision.

     Partial Permanent Disability (PPD)

     This is commonly known as a disability that prevents an insured person from doing one or more of the tasks that are part of their job, but does not prevent them from resuming or taking over any job.  However, the loss of a body part or an organ cannot be reversed.  Loss of an arm or leg and loss of an eye or a finger are examples of PPD.

     Free look period

     The Free Look Period is a 15-day period offered to all new health insurance or personal accident policyholders from the date of receipt of the policy certificate.  You can analyze whether the plan you have taken during this period is suitable for you.  Within 15 days, if you feel that the policy does not suit you, you can cancel it;  The premium paid will be refunded.  Though, the insurer and administrative costs will be charged for the period for which the coverage was available.

     Temporary Total Disability (TTD)

     An injury is a temporary disability that occurs when a person returns to his or her pre-injury state of health after treatment, which is called TTD.  Here an injury or condition such as a broken arm or leg or serious injury can be reversed.

     Grace Period

     If you fail to pay the insurance premium on time, the insurer will allow you an additional 30 days to pay it.  Even if you do not have insurance coverage during this period when the premium has not been paid, once the premium is settled, the policy will be reinstated with all its benefits.  Claims that may occur during this period will not be accepted under the condition also referred to as break in period.

    One thought on “Clarity on health insurance terms in India.”
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