Health Insurance | rupeecapital

Health Insurance Guide

Navigating the world of insurance can be complex, and understanding a policy document often proves even more challenging. Even with a thorough reading, the technical jargon may make it difficult to grasp key details. To simplify this process, we have developed a series of case studies that clarify common terms and features found in insurance policies. Our goal is to help you understand their implications, how they impact you, and whether they are essential for your needs.

Let’s begin with one of the most fundamental aspects of a health insurance checklist—co-payment.

Say no to Co-Payment?

You’re about to buy health insurance. The agent pitches a ₹5 lakh cover for just ₹7,000 a year. Then, he sweetens the deal—offering a 25% discount (roughly ₹1,800/year) if you agree to a 20% co-payment clause. Sounds like a great deal, so you sign up.

Nine months later, an accident lands you in the hospital. Your bill comes to ₹2 lakh. No worries—you have insurance. But the insurer only covers ₹1.6 lakh. The remaining ₹40,000? That’s on you, thanks to the co-pay clause.

Now, the math: You saved ₹1,800 but paid ₹40,000. It would take 22 years of savings to break even on this "bargain."

Co-payments rarely make sense—unless they’re mandatory or for someone older with pre-existing conditions, where they significantly reduce premiums. Otherwise, they can be a costly mistake.

Check for restrictions on room & room rent

Imagine falling sick and discovering that your health insurance has a cap on room rent. Begrudgingly, you check your policy document and find that the limit is 1% of your sum insured. If you’re covered for ₹5 lakh, that means just ₹5,000 per day for your hospital room. Not much, right? And now, you can’t pick the room you wanted—the one that costs ₹10,000 a day.

But you think, "It’s just for a couple of days. Even if I go for the better room, I’ll only have to pay ₹10,000 extra (₹5,000 x 2 days)." So, you opt for the plush room, expecting a manageable expense.

Then comes the shock. When you're discharged, the insurer drops a bombshell—you owe an extra ₹25,000!

Why? Because hidden in the fine print, your policy states that most hospital charges—surgeon fees, consultant fees, diagnostic tests, and more—are tied to your eligible room rent. Since your insurer set a cap at ₹5,000 but you picked a ₹10,000 room, they’ll only cover 50% of those charges.

Let’s say your surgery costs ₹50,000. The insurer will now only pay ₹25,000. The remaining ₹25,000? That’s on you.

Avoid policies with caps on room rent. It’s that simple. If you still want to pursue this policy, make sure you pick a room that’s well within the limit.

Check for Disease Wise Sub-limits

10 lakh cover at a premium of just ₹6,000 a year. That’s the offer in front of you. But instead of jumping for joy, you’re suspecting something already. This guy is offering you a price that nobody else is matching. You are sceptical and you ponder for a while. But you go ahead with his recommendation anyway since he is a family friend of sorts.

And then, one day, your worst fears come true. A slipped disk forces you into the operation theatre. You require extensive treatment. The final bill is hefty. ₹4,36,000 — inclusive of all costs. But despite your 10 lakh cover the insurer tells you they can only cover ₹2,00,000. You are outraged and you press for a clarification.

Eventually, they tell you your policy has disease wise sub-limits. Meaning, they have a cap on the total coverage amount specifically mandated for certain diseases.

For instance, cardiovascular diseases — They only pay ₹2,50,000

For knee replacements —₹2,75,000

For other major operations like the one you just had — ₹2,00,000

And finally, you realize how the company could offer you a ₹10 Lakh cover at such a low premium. They probably never end up paying the full cover amount in most cases.

Don’t fall prey to this devious practice. Make sure you always know there are no disease wise sublimits. Because you don’t know what will hit you. It’s always prudent to pick a policy that has no such stipulations, after careful comparison among the best health insurance plans available in the market.

Seek Low Waiting Periods

The scariest thing about insurance is the uncertainty of buying a policy. The moment the sweet-talking ends, the insurer will start asking about your medical history.

Do you have diabetes? Any cardiovascular issues? Thyroid-related illnesses? Or any other pre-existing conditions? The list seems endless.

Once they’re done with these questions, they might ask you to take a few medical tests. Based on the reports, they’ll inform you that they will cover your hospitalization—as long as it’s not related to a pre-existing condition. But what if you’re hospitalized for a complication arising from one? In that case, you’ll have to wait—anywhere from two to four years. While this clause makes sense for the insurer, it can be a frustrating reality for you.

Here’s the problem: Let’s say you disclose that you have high blood pressure and then purchase a policy. Unfortunately, the very next year, you suffer a heart attack. You hope your insurer will cover the expenses, but if they can link your heart attack to your blood pressure disorder, they may deny your claim. If your policy has a four-year waiting period, you’re left hoping you don’t fall sick due to a pre-existing condition. And trust us, that’s not a situation you want to be in.

Waiting periods are a standard feature in most insurance policies. The best you can do is choose a policy with the shortest waiting time—because when it comes to health, every moment counts.

Opt for pre and post-hospitalization care

You wake up one day and you start feeling dizzy. You consult your doctor. She prescribes a blood test. Nothing out of the ordinary, she says. So you go home with an ORS pack. But your condition deteriorates. You feel dizzy once again next evening. And this time the doctor prescribes an MRI. She checks the results and asks you to admit yourself to the hospital.

The doctor effectively treats your condition over the course of the next 3 days and you are discharged soon after.

The Hospital Bill adds up to ₹10,000

The MRI and the diagnostic tests before hospitalization adds up to ₹15,000

You are hoping your insurance covers both bills. But the company states they don’t cover pre-hospitalization expenses. Meaning they won’t cover all the costs you had to bear leading up to your hospitalization. Which is ironical because doctors often prescribe a host of diagnostic tests before they admit you to a hospital and sometimes even after they discharge you. And it can get quite expensive.

It’s always a good idea to pick a policy that covers both pre and post-hospitalization expenses. Say 30–60 days before and after you are treated in a hospital.

Ask for restoration benefit

It’s a Sunday morning and you’re sipping coffee on the hospital bed. You are thinking about how a small heart complication forced you into a 3-week stay at the hospital. More importantly, you’re thinking about how you racked up a bill totaling ₹4,88,000. Thankfully, your insurance policy is going to take care of the burden. After all, you have a ₹5 Lakh cover. So you don’t have to pay anything right now. But you start thinking about other possibilities.

See, you bought a combined policy — For both your wife and yourself. And if she were to fall sick anytime soon, then the insurance won’t cover her bills. You’ve used up the benefits already.

But what if the insurance restored itself to the initial state immediately after you make a claim? What if your insurer offered you a ₹5 lakh cover once again in the event you or your wife have to be hospitalized anytime soon?

Well…Guess what? It’s possible with a restoration benefit.

While some policies offer unlimited restoration for any illness, others have some restrictions. For instance, some policies will tell you that you can’t claim the restoration benefit if you have the same illness once again. In this case — a heart complication.

It’s always prudent to opt for restoration benefits if you have a combined policy. It also makes sense even if it’s an individual policy. Just make sure you read the fine print on how the cover is restored each time and you’ll be set.

Seek coverage for treatments that last <24 hrs

You are out playing a game of cards with your friends. Suddenly you feel a sharp twitch in your abdomen. It's odd, but these things keep happening to you all the time. So you don't pay a lot of attention. A few moments pass. and then suddenly the twitch is there again. This time it doesn't go away. Instead, within a moment the pain intensifies. Soon, it becomes unbearable. Your friends take you to the hospital. And after a quick inspection, the doctor breaks the news. It's appendicitis and they have to operate on you immediately.

But it's not that big of a deal. In fact, the doctor assures you that he'll discharge you the same day. And although you require some treatment, you walk out of the hospital within 24 hours. However, it's an expensive procedure. The bill adds up to ₹80,000 and you're gobsmacked. You call your insurer hoping they will cover these costs in full. And suddenly they break the news to you. They won't cover this.

You are incensed and you press for a clarification. The agent calms you down and walks you through the policy document once again - where they explicitly note how they don't cover daycare treatments. Or in other words, treatments that require hospitalization but those that last less than 24 hours. Think - Chemotherapy, Dialysis or in this case appendicitis.

Always prefer policies that cover daycare treatments. Because you never know when your appendix might put you in a soup.

Domiciliary Expense

A deadly pandemic starts wreaking havoc. However, your job forces you to step out every day. And then suddenly, one day you wake up with a bad cold. You are coughing incessantly. You hope it’ll go away on its own. But then you have trouble breathing. Your condition deteriorates and you are forced to call the emergency services. But they tell you they can’t find a hospital bed. Your only choice is to obtain treatment at home. Some hospitals provide this facility. But it's going to cost you money. A lot of money!!!

And then a ray of hope. Your insurer tells you they will cover your expenses since you are forced to be treated at home.

It could be because of a specific condition or because the hospital couldn’t find you a bed — Like in this case. It’s rare to be in such a spot. But you are glad you have this facility nonetheless.

Another good-to-have benefit. But in most cases, you don’t have to go out of your way to find a policy that will cover domiciliary expenses.

Bonus in case you don’t make a claim

Insurers will tell you they want you to stay fit and healthy. In fact, they will even incentivize you in a bid to achieve this objective. For instance, how would you feel if somebody told you they’ll up your cover (above and beyond the sum insured) by 50% each year in the event you don’t claim insurance. That would be amazing, right?

Think about it. You could start with a cover of ₹5 lakhs. And then see it move up to ₹7.5 lakhs and then the next year, another 50% over and the above the sum insured would take your total cover to 10 lakhs. Obviously, they’ll stop at some point. Most insurance companies will tell you they’ll stop once the cover doubles in value. In fact, they’ll also tell you they’ll cut the sum insured by the same amount (50%) in the event you claim insurance after receiving the bonus. So technically, next year, you could be back with a cover of just 5 lakhs.

But still, it’s a pretty nifty bonus.

No Claim Bonus is pretty useful. All you have to do is make sure that the bonus is actually substantial. For instance, anything below 10% is not really meaningful. So it might just be a marketing tactic.

Free health checkups every year

You wait patiently at the clinic until, finally, your name is called. A routine check follows—height, weight, blood pressure, heart and lung examination, cholesterol, and blood sugar tests. The next day, your results arrive—everything is perfect. No follow-up needed, at least for another year.

Regular health checkups offer peace of mind, but they come at a cost—₹1,000 to ₹1,500 per visit. While it may not seem like much, these expenses add up over time.

Now, what if you didn’t have to pay? Some insurers cover health checkups, maybe not every year, but even once in two years is a bonus. It’s not a deal-breaker, but having a policy that offers free annual checkups? That’s a benefit worth considering!

Cover for Alternative treatments

Feeling drained but your doctor says you're fine? A chat with your neighbor leads you to a government-certified Ayush Centre. They recommend Panchakarma therapy—7–11 days, ₹25,000.

Pricey? Not when your health insurance covers Ayush treatments! Just remember, coverage applies only if you're hospitalized in a certified facility. A good-to-have feature that can save you big!

Maternity Benefits

Planning for a baby? Hospital costs can be high, and maternity insurance sounds like a smart solution. But here’s the catch—insurers know you’ll likely claim it, so they price it accordingly.

Expect higher premiums, partial coverage, or bundled family plans that make you pay more than you need to. In many cases, you might be better off saving for the expense instead of overpaying for limited benefits.

Before signing up, crunch the numbers—sometimes, insurance isn’t the best deal. There’s no free lunch in finance!

When should you opt for OPD?

Everyone visits the doctor at least once a year. But the doctor you visit? Their consultation fee is sky-high. A routine check-up could cost you thousands.

So, you come up with a brilliant plan—you decide to buy insurance. You specifically look for a policy that reimburses all expenses from these visits. After a quick search, you find one that includes outpatient consultation benefits.

“Genius,” you think, giving yourself a pat on the back.

But, as always, things aren’t as simple as they seem.

For one, insurers know they’ll have to pay you something every year. Think about it—have you visited the doctor this year? Did you spend over ₹1,000 on consultation fees? More than that? Do you expect this to change?

Probably not.

That’s exactly why many insurers don’t offer this benefit. The ones that do make sure they’re covered—either by charging significantly higher premiums or by reimbursing only a small fraction of your expenses.

There’s no such thing as a free lunch. While OPD benefits might seem attractive, you could actually end up paying more in premiums than you save. In most cases, skipping this benefit could be the smarter financial decision.