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    Understanding the basics of top-up covers/policies

    Understanding the basics of top-up covers/policies

    Understanding the basics of top-up covers/policies
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    By CNBCTV18.com Contributor  IST (Updated)

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    In times where medical expenses are touching the sky, having a cover is imperative. But is just having a health insurance plan enough? What if the hospital expenditure exceeds the expected amount? Top-up and Super Top-up is your answer!

    The primary health insurance plan, in today’s times, can never be enough. Like the unfortunate advent of COVID 19, medical emergencies can occur anytime and in any place. Nobody can be too prepared for it.
    In times where medical expenses are touching the sky, having a cover is imperative. But is just having a health insurance plan enough? What if the hospital expenditure exceeds the expected amount? Top-up and Super Top-up is your answer!
    A regular policy might only cover expenses until the insured sum, whereas a top-up plan covers costs after reaching the threshold. Alternatively, a super top-up is a plan that gets activated once your hospital expenses exceed a deductible limit.
    What is the difference between a Top-up medical cover and a Super Top-up medical cover?
    Before we jump to understanding the difference, we need to understand what a deductible is. A deductible, here, refers to the amount of money that the base mediclaim covers before the top-up plan or the super top-up plan gets activated.
    Situations Top-up Cover Super Top-up Cover
    Coverage Provides a single claim over and above the sum insured of the existing mediclaim Provides similarly, but they cover cumulative expenses that exceed the deductible amount and the original sum insured. In addition, they cover costs that are not covered by a Top-up policy.
    Sum Insured of 2 lakhs Provides a cover if one has a Top-up plan of 5 lakhs, with a 2 lakh deductible. Provides a cover if one has a Super Top-up plan of 5 lakhs, with a 2 lakh deductible.
    Hospital expenses amount to 7 lakhs (Single Claim) One’s base mediclaim policy covers 2 lakh of the claim amount. The remaining five lakhs above the deductible will be taken care of by the Top-up mediclaim plan. One’s base mediclaim policy covers 2 lakh of the claim amount. The remaining 5 lakhs above the deductible will be taken care of by the Super Top-up mediclaim plan.
    Two claims of 2 lakh each is made Since your base policy only covers two lakhs worth of expenses, it will cover the first claim entirely. While the other claim amount is not more than the deductible amount, the Top-up plan is not activated. Since your base policy only covers two lakhs worth of expenses, it will cover the first claim entirely. However, since Super top-ups consider the accumulated value of the claim, even though the 2nd claim does not exceed the deductible amount, it still gets activated.
    SituationsTop-up CoverSuper Top-up Cover
    CoverageProvides a single claim over and above the sum insured of the existing mediclaimProvides similarly, but they cover cumulative expenses that exceed the deductible amount and the original sum insured. In addition, they cover costs that are not covered by a Top-up policy.
    Sum Insured of 2 lakhsProvides a cover if one has a Top-up plan of 5 lakhs, with a 2 lakh deductible.Provides a cover if one has a Super Top-up plan of 5 lakhs, with a 2 lakh deductible.
    Hospital expenses amount to 7 lakhs (Single Claim)One’s base mediclaim policy covers 2 lakh of the claim amount. The remaining five lakhs above the deductible will be taken care of by the Top-up mediclaim plan.One’s base mediclaim policy covers 2 lakh of the claim amount. The remaining 5 lakhs above the deductible will be taken care of by the Super Top-up mediclaim plan.
    Two claims of 2 lakh each is madeSince your base policy only covers two lakhs worth of expenses, it will cover the first claim entirely. While the other claim amount is not more than the deductible amount, the Top-up plan is not activated.Since your base policy only covers two lakhs worth of expenses, it will cover the first claim entirely. However, since Super top-ups consider the accumulated value of the claim, even though the 2nd claim does not exceed the deductible amount, it still gets activated.
    What should you consider before buying either of the top-up plans?
    Top-up Mediclaim Policy
    Following are a few things that you should consider before selecting a Top-up plan:
    1. Higher the deductible value, the lesser the premium
    2. Remember that top-up plans bridge the gap between existing policies and actual costs. The idea is to buy extra cover at reasonable prices. Hence, daycare or dental care exclusions do not make much difference as your base health insurance policy will take care of them.
    3. Check the criteria for deductibles such as waiting period for pre-existing diseases, single illness, pre, and post-hospitalization costs, and limits inclusive of donor expenses.
    Super Top-up Policy
    Following are a few things to keep in mind when you are considering a Super Top-up plan:
    1. Opt for a proper deductible limit. The deductible is the same as your base policy covers, so make sure you thoroughly consider your policy options and not just the premium amount.
    2. It is imperative to check the list of network providers, the extent of coverage provided by the policy, etc.
    These policies might have their pros and cons, but they secure you and your loved ones a little more. In a world where medical emergencies can occur anytime, we must stay prepared for anything unprecedented out there.
    The author, Nikhil Chopra, is Chief Business Officer at Medi Assist Healthcare Services. The views expressed are personal
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