Mayur Shetty | Aug 12, 2013
MUMBAI: A common dilemma among employees covered under their employer's group mediclaim policy is whether to buy an additional individual health cover.
Concerns over inability to build a health insurance track record and the lure of tax breaks have made many consider a separate cover. But the high cost and the fact that they are buying a duplicate cover puts them off.
The good news is that many products now address this segment. The latest such offering is Optima Super by Apollo Munich Health Insurance. This policy is positioned as a regular cover, but can be bought with a deductible up to the amount for which the buyer is covered with the employer. For instance, if the employer provides health insurance up to Rs 3 lakh, the employee can buy an Optima Super cover for Rs 5 lakh with a Rs 3 lakh deductible. A deductible in insurance refers to that portion of the claim that the employee has to bear on his own.
"The premium on a Rs 5 lakh policy with a Rs 3 lakh deductible is much cheaper than a policy with a Rs 2 lakh sum insured because most of the claims are well within the first few lakhs of the sum insured limit," said Antony Jacob, MD, Apollo Munich. He said the advantage of the deductible policy is that the insured individual is assured of continuity benefits when he chooses to remove the deductible clause.
The other option for employees is portability. According to Shreeraj Deshpande, head of health insurance at Future Generali Insurance, the advantage portability offers is that the insured gets credit for the period he was covered under a group policy. This means that his claims under the new policy cannot be rejected on the grounds that any ailment was pre-existing, even if it was.
"Although individuals can 'port' their policies from group contracts to individual covers, taking this policy with a deductible also takes care of situations where a person may switch jobs a couple of times in his career," said Jacob, arguing that the deductible policy is a better option to top-ups. The other limitation of the portability cover is that employees can switch to an individual policy up to the same level as the terms of the group cover. The other limitation is that upon porting, the company does not give a wider cover than what was available on the older plan.
"Most companies usually provide a health cover of around Rs 2 lakh for the employees which can fall short. It is an ideal option for individuals to complement the base group policy with a sufficient and comprehensive indemnity policy which can be utilized later, even post retirement. Max Bupa provides any age enrolment to customers since 2010. Under Max Bupa's new Heartbeat plan, customers have the option of tapering co-pay, industry's first feature that provides those above 60 with reducing and subsequently zero co-payment on continuous renewal," said Manisje Mishra, MD & CEO, Max Bupa Health Insurance.