Not long ago, I faced a problem with my health insurance policy. Our claim was rejected on the basis of pre-existing diseases. It is the year 2008 when I used to work in Kolkata.
We were very unprepared for the rejection of the claim. Moreover, I was also unaware of the criticality of such a clause. So, that episode made me feel cheated. Nevertheless, I realized its validity later.
Since then, IRDAI has also updated this clause several times. I think, if I had made that claim today, the chances of rejection would have been minimal.
Anyway, since then, the topic of pre-existing disease has always attracted my attention.
after leaving jobWe bought family floater health cover. Not surprisingly, the sales rep had to spend an extra 10 minutes explaining a pre-existing illness. 🙂
In the last few months, something happened that again caught our attention pre-existing conditionn (I’ll tell you that story later)
What is a pre-existing disease?
In simple medico-legal terms, pre-existing disease means any condition, disease or injury for which the body had symptoms for 48 months prior to the first issue of the policy.
It means that if a person has issued health policy on January 1,21, then any disease showing symptoms in the body after 31-Dec’16 is treated as pre-existing disease. In addition, it is also Mandatory for declaring the said condition, if known, at the time of application. The beneficiary cannot explicitly exclude a known illness in the policy.
So, what happens if a disease is classified as a pre-existing condition?
If any disease comes under this purview, then it will be covered under the health insurance policy only after it is over waiting period (24 to 48 months).
what does this mean? Pre-existing conditions will not remain out of health insurance cover forever. They will be covered after the “waiting time” is over. But it is mandatory for the beneficiary to declare any known condition at the time of purchasing the policy.
Any disease diagnosed for the first time after purchasing the policy will not be treated as a pre-existing condition.
What is a waiting period?
Waiting period is the time the policyholder has to wait to claim health benefits after the health policy comes into force.
There may be a variety of waiting periods depending on the type of health insurance policy. In this article, we’ll explain its four common types:
- accidental hospitalization: Provides health insurance cover zero day Waiting period for all hospitalizations caused by accidents. This means, if the date of commencement of the policy is 1st January, then a valid accident claim can be made on 1st January only.
- initial waiting period: The duration of this waiting period is 30 days From the date of issue of the policy. This is the period for which the policyholder must wait before claiming any benefit (except for accidental hospitalization).
- waiting period for specific disease: there is one list of specific diseases For which the claims will be paid only after the expiry of this period. Generally, for all health policies, this waiting period is approximately 24 months From the date of issue of the policy.
- pre-existing diseases: Any disease falling under this category will take more time to wait. Typically, this type of waiting period can fall between 24 to 48 months.
Benefits of group health insurance
I have a friend who works in a company. He had health insurance cover provided by his employer. Recently, his company offered him an additional benefit. The company was giving health cover to their elderly parents, but my friend would have to pay an annual premium of Rs 10,000.
My friend was confused whether he should take the offer. In fact, he was questioning whether there was any benefit from it? my friend said, “the company is charging Rs.10,000 per annum. So how is it a profit, it’s a cost to him“.
In a way he was not wrong. But to understand the benefits we must look at a bigger picture.
One of my friend’s parents suffers from medical conditions like minor liver cirrhosis, thyroid, diabetes and prostate. These diseases a. would fall under the category of pre-existing diseases. In addition, both parents were over 65 years of age.
In this situation, if my friend went to buy a personal cover for his parents, it would be very expensive. My estimate of premium for such health insurance would be approximately Rupee. 50,000 per year.
In addition, there will be a provision of waiting period for pre-existing diseases. My friend also once told me that his parents needed to be hospitalized more than once every year.
If my friend decides to cover his parents in the group insurance cover, he will see two immediate benefits:
- low premium: Considering that this is a group insurance provided by the company, the premium cost is only Rs.10,000 per annum to include the parents.
- Cover for pre-existing illness: In case of group insurance policies, all valid claims can be made from day one. This means the waiting period will be zero days even for pre-existing diseases. This is a special benefit offered by group insurance policies.
Group insurance health cover is great for people with pre-existing conditions. So if you choose between personal (family floater) and group cover, then group insurance would be better.
From the point of view of the insured, the waiting period is an important rule of any health cover. Why? Because it directly affects the chances of claim settlement.
Here is a quick checklist of three important sections of any health insurance plan that one must read before buying:
- waiting periodPeople are asked to wait for a specific period before claiming benefits from their health cover. The shorter the waiting period, the better. Go for a health cover that offers the least waiting time.
- network of hospitals: To get cashless treatment, the patient has to be admitted to certain specialized hospitals. These are the hospitals that have partnered with the insurer to offer the cashless facility. Check out the list to know if your favorite hospitals are on the list.
- Insurer’s Claim Settlement Ratio: The insurance provider who has the highest Claim Settlement Ratio (CSR) is considered the best. CSR indicates the number of claims settled in the financial year for every 100 number of claims received.
|number||Insurance company||CSR||All Claims (NOS)||Area|
|1 1||future general||82.96%||99,462||Private|
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