Categorized | Health Insurance

what happens to the health policy coverage after a claim is filed?

There are many types of Health Insurance available in India, such as those reimbursing Hospitalization expenses, major surgeries and post surgical care, and non-domiciliary expenses. Often, the health Coverage is valid for a year and needs to be renewed each year. For some, the yearly premiums must be paid to keep the health Policy alive. In a limited Premium payment family floater, premiums have to be paid for shorter duration while the policy Term is nearly for a lifetime.

When, health claims are filed, the coverage option differs from one plan to another. Sometimes multiple claims can also be done in some Mediclaim policies while in few others, there is a restriction on the amount of further Claim one can get. Here are some aspects on what exactly happens to a health policy after a claim has been filed.

Reduced Benefit
Once a claim is made on a policy year, the sum Insured is reduced corresponding to the amount already paid in the settlement. In other words, the health claim is reduced to the amount that has been disbursed to the policyholder. There  may be more than one claim per year as well. However, the maximum limit on the claims taken together in a year must be equal to the sum insured.

The policy may require to be renewed the following year. During this time, an increased premium can be charged by the health insurance company. This concept is known as loading, which almost all health insurance providers levy in case the Policyholder stakes claim the previous year. Different health insurance companies have different ways of levying the Loading charge on the customer. For instance, 5 percent increase on the premium is a normal loading charge levied by the insurance provider.

Daily Hospitalization Benefit and Surgical Benefit
There are some family floaters which provide financial assistance at various installments during the entire course of the treatment. Some of the health policies are ULIP-based ones with limited premium payment period yet whole-life policy term. The health claim can be done through a TPA where daily expenses on hospitalization of the policyholder or any of his family members are provided. An additional surgical benefit is provided irrespective of whether the daily expenses are provided or not. In such health care plans, the amount of benefit is predetermined earlier when the policy was bought and does not generally depend on the number of claims done during the policy term period.
 
Once the health claim is filed for such policies, the compensation is provided and the policy continues as it is. Other family members included in the family floater also enjoy similar benefits. Some health insurance policies provide multiple payouts as well. So, here as well, there is no reduction on the benefit.

Critical Illness Policies and Riders
There are many policies which have riders, such as accidental benefit rider, Critical Illness rider, and so on. Once the claim is provided on the riders, that particular rider seizes to exist or sum insured is reduced without any rider perks offered after the claim is made.
Critical illness health insurance provides a lump sum amount in case the claim is made on the critical illness. The policy is most often terminated after the payment. Few policies allow benefits for the remaining critical illness diseases.

In short, mediclaim policies reimburse expenses on health related issues. Just as premiums are reduced or amount of sum Assured is increased in case there are no claims made for a particular period, the same can be increased if claims are filed. Many therefore, plan copayment to keep the premium constant. So, plan how you want to claim the benefits of your health insurance as you may be in for a surprise when renewing your policy.