3 Steps to Buy A Health Insurance Plan

Health insurance policies are complex and difficult to comprehend for most people as there are many features and benefits included in a single policy. By going through all the features and finding one right policy for yourself, can take hours if not days. 

But we have made things easy for you. If you are looking for a health insurance policy, always go by the basics. Here’s a quick

3 Step Guide To Select A Good Health Insurance Plan.

In this guide, we’ve tried to cover every steps required to select the best health insurance plan for you and your family.

[1] Select The Right Insurer

Opting for a health policy with fancy features only makes sense when it comes from the stable of a reputed and financially sound insurer. Hence selecting the right insurer is crucial. After all, it is your insurer who issues your policy and settles your claim when need arises. So select an insurance company which is more likely to settle claims smoothly. 

Here is how you can shortlist a few good insurance companies. Or you can eliminate the bad ones.

Claim Settlement Ratio: Claim settlement ratio says how many claims an insurance company settles out of every 100 claims it receives. This is an important metric as you would always want to go with an insurer who has a good track record of settling claims in the past. Go for a health insurer whose claim settlement ratio is 90% or above. Check for last 3 years’ numbers instead of just last year’s figures to avoid recency bias. You can simply ignore insurers who fall below this mark. 

Incurred Claim Ratio: Incurred claim ratio indicates how much a health insurance company is spending on settling claims out of every Rs. 100 it earns as net premium. Any number between 60% to 80% is good. It implies that the insurer pricing its products efficiently and is keeping its cost of claims within the range to maintain financial stability. 

A high incurred claim ratio implies that the insurer is spending too much money on cost of claims which might push it into financial trouble. A low incurred claim ratio says that the pricing of insurance plans is not efficient and needs a relook. 

Volume of Claim Complaints: This is a very important factor which indicates how an insurance company is handling its claim requests. When it comes to raising a claim under your own health insurance policy, you would want your experience with your insurer to be smooth and easy. Check out the volume of claim complaints faced by any insurer to ensure that you select a health insurer which is handling its claim requests well. We recommend you to select an insurance company only if its volume of claim complaints is 20 or less. Again, check out last few years numbers instead of just seeing last year’s or last quarter’s figures.

Business Track Record: A good past performance is one of the indicators of expected future performance. So always select an insurance company with a decent business track record. You can avoid choosing very new or innovative health insurance products or health insurance companies whose experience is yet to emerge.

[2] Select The Right Health Insurance Policy

There are 3 things which you need to see.

Must Have Features: Your health insurance plan should cover all base benefits including inpatient hospitalisation expenses, daycare treatments, pre and post hospitalisation expenses and cost of consumables at actuals. Make sure you make no compromises here. There should ideally be no restrictions on room rent or room type so that you can choose to stay in the best room available without any worry. There should neither be any disease-wise sub-limits or restrictions.

If you are looking for health insurance cover for people with special requirements, look for the features which meet those requirements. People with pre-existing conditions can scout for plans which provide instant cover for PEDs so that they don’t have to serve the waiting period for PEDs. If you have senior/older citizens in your family, buy a separate policy for them for them.

Good To Have Features: Here are some good to have features which you can add to your health insurance plan to enhance your coverage. A good no claim bonus (NCB) is always a welcome as your health cover increases with time to take care of medical inflation. Unlimited restoration is good to have but it might not make sense beyond a point. Look for health insurance plans which offer a lower waiting period for PEDs if you have any pre-existing disease. Adding a personal accident cover can also enhance your health coverage at a little extra cost. If you get global cover under your health insurance plan, it would be a great addition.

Features Which Can Be Avoided: In health insurance plans, not all features are desirable. Some features are gimmicky and are added to drive sales. You might just be better off by not having them. 

Maternity is usually planned and hence it comes at an extra cost or with long waiting periods. Health insurance works the best when you buy it to cover unexpected and unplanned large medical expenses. If you are buying a health insurance plan just to avail maternity benefits or paying an extra premium to get maternity benefit add on, you can as well avoid it. The same applies for OPD cover. It is better to pay the cost of all your OPD treatments out of your own pocket and keep health insurance for those large unexpected medical expenses. 

[3] Talk to A Good Advisor

Are you still confused? Book a call with us.

Our advisor will guide you to select the right health insurance plan for yourself and your family. If you wish to buy the policy, the advisor will guide you through your health insurance purchase journey as well.