Tag: health plan

Demystifying restore benefit in health insurance

Personal Finance

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Since the outbreak of Corona virus many people have filed health insurance claims, resulting in partial or complete exhaustion of their sum insured (SI) or health cover amount. While the claim would have reduced the policyholders’ SI, most health policies in the market come with a built-in back-up option. In other words, insurers fully reinstate the original SI once it is exhausted. This means after the entire cover amount is used up in a policy year, there will still be a cover available to the extent of the SI.

The reinstatement of SI feature is also known as restore, recharge, refill or reload feature across insurers and is available in case of hospitalisation. But there are minor drawbacks to this feature. Here is all what a policyholder should know about this benefit.

How does it work

Almost all health insurers offer to refill your original health cover amount post a claim but the process varies across insurers.

A restoration of SI in your health policy can happen in two ways. One, an insurer refills the used-up portion of SI only after complete exhaustion of the policy amount. Say suppose, your health cover is ₹10 lakh and during the policy period you utilise the entire amount. Then, the refill feature come into play and reinstates your cover up to ₹10 lakh, which was your original SI. But if you claim only ₹5 lakh in this scenario, your SI stands at ₹5 lakh only. For instance, policies including Manipal Cigna’s Pro Health Insurance plan, Activ Health from Aditya Birla Health insurance, ICICI Lombard’s Complete Health insurance and Star Health’s Star comprehensive plan offer this benefit.

Two, there are some policies in the market which offer to reinstate the cover even if there is partial utilisation only. That is, if you claim ₹5 lakh out of ₹10 lakh (SI), then the SI is reinstated up to ₹5 lakh and your total health cover is ₹10 lakh post the claim. Policies that offer this feature include Max Bupa’s Go Active, HDFC Ergo’s Optima Secure plan, Arogya Supreme plan from SBI General and Lifeline plan from Royal Sundaram General Insurance.

Take note

While with the restoration feature, you and your family will never run out of health coverage during any policy year, policyholders should be aware of three key points.

One, typically, the restore benefit is available only once during a policy year where 100 per cent up to base SI is reinstated after complete or partial exhaustion of base SI. If there are multiple claims during the policy year, then the restore benefit may not help. However, there are a few policies in the market that offer unlimited restoration benefit during the policy period if you exhaust your health cover completely or partially. Care Plus plan from Care Health Insurance, Max Bupa’s ReAssure plan and Manipal Cigna’s Pro Health Insurance plan are a few examples.

Second and one of the most important points to remember is that, an insurer reinstates the SI and the same will be available only for subsequent claims. That is, if you make a claim for ₹5 lakh for heart-related ailments (SI is ₹10 lakh), the insurer will restore ₹5 lakh that you have claimed but it can be utilised only on your next claim and not for your current claim. So, even if you exhaust ₹10 lakh and the total claim amount works to ₹12 lakh, the balance ₹2 lakh has to come from your pocket. This is because the ‘restored’ SI will be available from next claim onwards.

Also, most policies do not offer the ‘reinstated’ SI for the same illness for which you had made the claim in a policy year. Say, you have claimed for one specific heart-related illness, then the ‘restored’ or ‘reinstated’ SI may not be used for the same ailment by the policyholder. However, there are a few policies in the market such as ReAssure (Max Bupa) and Care Plus (Care Health Insurance) that do cover for the same illness subsequently.

And lastly, the restored or reinstated SI if unutilised during the policy year, expires. That is, it cannot be carried forward for next year. It will also not be considered for no claim bonus (a reward that policyholders receive from the insurer for staying healthy and not making any claim on the policy in a year) calculation.

In case you have an older health policy which doesn’t have a restore or refill feature, then you can consider migrating, though ‘restore’ benefit shouldn’t be your only criteria for policy selection. If the policyholder feels he/she is missing out on the new features such as restoration, then one can consider migrating or porting to a new policy. Indraneel Chatterjee, Co-Founder, RenewBuy says “The decision for migrating or porting should be based on three key factor – premium comparison, room-rent capping and co-payment clause. Only if these factors are favourable, one can check other features such as restore or refill”.

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Product Review: Aditya Birla Activ Health policy is value for money

Personal Finance

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Aditya Birla Health recently introduced Activ Health policy, an enhanced version of its existing policy with the same name. While the coverage in the policy almost similar to its older version, there are a few new features.

New features

The newly launched Activ Health (an improved version of the same policy) is a comprehensive indemnity health plan offering sum insured (SI) of ₹2 lakh to ₹2 crore. While the same SI range was offered in the earlier version as well, there are a few notable new features.

In this new Activ Health, room rent for all kinds of hospital rooms is covered up to the SI, similar to other indemnity health plans in the market. But in the previous version, co-pay was applicable. Another key feature that is unique to this new product is that the premium is waived, at the renewal, if the policyholder is diagnosed with a critical illness (once).

Also, in its earlier version of Activ Health, the policy offered about 30 per cent discount on premium for staying fit. Now, in the new version, 100 per cent premium can be adjusted with the health returns. But you as a policyholder should earn points (health returns) through accumulation of Active dayz. For instance, one Active dayz can be earned by 10,000 steps or more in a day or burning 300 calories or more in a day. So if you earn, say, 325 Active Dayz in a year by walking, then the entire health returns can be adjusted with premium payment. It also covers inpatient treatment under AYUSH that allows you to opt for Ayurveda, Unani, Siddha, and Homeopathy treatments which was not available in the previous version.

Both the old and the new policy covers for a few chronic diseases including hypertension, blood pressure and diabetes from day one. Under its chronic management programme which forms a part of the plan – where an individual has undergone a pre-policy medical examination and is found to be suffering from covered chronic conditions, then day one coverage is offered. In the earlier policy, however the hospitalisation came with a waiting period of 90 days. But in the enhanced version hospitalisation expenses for such diseases will be covered without any waiting period (90 days).

Other features of Activ Health plan include coverage for in-patient hospitalisation, OPD, recovery benefit (where the insurer pays fixed benefit for 10 consecutive days of hospitalisation due to accident), day care treatment (covered up to SI) and sum insured reload benefit and cumulative bonus benefits. The plan also provides coverage for Covid-19 and personal protective equipment (PPE) kit, gloves and oxygen masks. There is no co-pay for zone wise premium (policyholder pays premium as per the treatment cost prevailing in the city he/she resides) too for SI over and above ₹4 lakh.

Points to note

Activ Health’s reload feature offers to reinstate your SI even if it is partially or fully exhausted. But it is available only once during the policy year up to SI. But on the other hand, if you go for Activ Health’s Premiere variant, then this feature is available for multiple claims. Also, the pre and post hospitalisation expenses are covered for 60 days and 180 days respectively for this new plan unlike Aditya Birla Health insurer’s other product like Assure Diamond where it is 30 and 60 days respectively.

Also, another point to note is that, if an individual has taken a policy without medical examination (pre-policy medical check-up), but later finds that he/she has one of the chronic conditions, then the waiting period of 24 months applies. One should be aware that the pre-existing disease waiting period is between 36 and 48 months. But there are policies in the market with shorter waiting period including Digit Health Insurance’s Health Care Plus and ICICI Lombard’s iHealth Plus.

Keep in mind, that, policyholders have to undergo initial waiting period of 30 days.

Premium comparison

The new Activ Health is better compared to its previous version as also the insurer’s other plans like Assure Diamond. However, there are other products too in the market with more or less similar features. Max Bupa’s ReAssure plan is one such. For a 30-year individual, for a SI of ₹ 10 lakh, the premium works out to be ₹7690 (excluding tax) per year, while in Max Bupa’s ReAssure plan, the premium works out to be ₹7755 (excluding GST) per year.

Those in the previous version of Activ Health can be upgraded to the new version at the time of renewal. The premium too works out to be lower in the new version. Sample this, for a 30-yr individual, for ₹10 lakh SI, the premium works out to ₹7690 (excluding GST) but the premium for the same policy in its previous version is around ₹8307 (excluding GST).

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