Arogya-Sanjeevani-policy-pros-and-cons

Pros and Cons of Arogya Sanjeevani Insurance Plan

With the COVID-19 pandemic affecting livelihoods and lifestyles of people all around the globe, conversations around healthcare are taking centerstage once again. Talks of accessibility and affordability are more pertinent now than ever before. One of the “tools” that makes healthcare affordable and acts as a cushion during the time of a medical emergency is health insurance. Health insurers collect a relatively small amount from you at periodic intervals (quarterly or annually) in exchange for bearing some or most of your healthcare expenses in the event of a health crisis. 

The concept is beautiful and effective given the rising costs of healthcare. However, there is a large section of people who find it difficult to afford even a nominal premium cost from private insurers or are unaware about the nuances of health insurance as a whole. We must also take into consideration that India has been a traditionally underinsured country. It is to target this uninsured and under-insured group of people that the Arogya Sanjeevani Health Insurance was formulated and launched by IRDAI in April 2020 in India. 

What is the Arogya Sanjeevani Health Insurance plan? 

The Arogya Sanjeevani Health Insurance plan is a standard plain-vanilla health insurance plan that has been introduced by IRDAI. With this policy, the insured person or family can avail a sum-assured that ranges from Rs.1 lakh to Rs.5 lakh. You can opt for either an individual health insurance or a family floater plan (including spouse, children, parents and parents-in-law) under the Arogya Sanjeevani Health Insurance plan. The plan has been introduced to propagate the importance of health insurance for everyone.

In a manner similar to everything else in the world, the Arogya Sanjeevani Health Insurance too has its pros and cons. Read them to make a better and more informed choice! 

Pros of Arogya Sanjeevani Health Insurance Plan

Wider coverage: The Arogya Sanjeevani Health Insurance Plan offers extensive coverage under a single premium. These include the usual pre and post hospitalization charges, ambulance charges and dental treatments. Apart from this, the plan also covers any expenses incurred for the treatment of coronavirus. Another substantial benefit from the plan is coverage for alternative treatments like homeopathy and Ayurveda (AYUSH Benefit). The Arogya Sanjeevani Health Insurance Plan also covers modern and new-age treatments for advanced illnesses like oral chemotherapy, stem cell therapy etc. which is surprising for a plan as affordable as this one. 

Low and affordable premiums: The hallmark of the Arogya Sanjeevani Health Insurance Plan is its affordability. The Arogya Sanjeevani Health Insurance Plan has one of the lowest premiums compared to other policies that offer similar coverage. Although the premium is not a fixed amount and varies from insurer to insurer, the range is still low and affordable. The policy is a great bargain for families who do not have health insurance at all and wish to invest in a health insurance cover to secure their healthy future. 

No zone pricing: Most insurance plans have zone-based pricing. That is, premiums charged for people living in Tier-1 cities would be higher than Tier-2 and Tier-3 cities. This makes financial sense as well, since treatment costs are higher in metro cities than in Tier-2 and Tier-3 cities. For example, with most health plans, you cannot avail treatments in metro cities if you are paying the premium of your residential city if it is a Tier-2 city. But the Arogya Sanjeevani Health Insurance Plan eliminates this distinction and charges the same premium whether the policyholder lives in a metro city or not. This makes it easier to change your residential location and not worry about a change in the rate of your annual  premium. 

Low co-payment: The Arogya Sanjeevani Health Insurance Plan has one of the lowest co-payment features in the health insurance industry. With regular health insurance plans, the minimum co-payment that you need to make to avail a benefit is 10%. Which means, you have to bear at least 10% of the costs associated with your medical treatment. But the Arogya Sanjeevani Health Insurance Plan has brought down the co-payment clause to 5% which is a welcome change and helps in making health insurance affordable and accessible to all.

No complicated terminology: A unique feature of the Arogya Sanjeevani Health Insurance Plan is that it is standardized and a plain vanilla product. People who intend to purchase health insurance end up getting lost in the sea of jargon, its features, pros and cons. But this does not work with the Arogya Sanjeevani Health Insurance Plan as there is no other health plan in the market which provides a similar coverage at such an economical cost. Moreover, you do not have to make any choices while buying the policy as it is a standardized health insurance plan with no variations.

Lifetime renewability:  The Arogya Sanjeevani Health Insurance Plan comes with lifetime renewability. That is, the policy term is one year but you can keep renewing the policy every year for the rest of your life. The plan also comes with a 15-day free-look period. Which means that if you buy the policy and cancel it within the first 15 days you will not have to pay any cancellation charges. However, this feature is not available during policy renewals and is only applicable during the first purchase. But you can still cancel the plan and get a refund towards the premium depending on how much time has elapsed between the date of purchase and date of cancellation. For example, you will get a 25% refund if you cancel the plan between 3 months to 6 months from the date of purchase. Normally, beyond that period, there is no refund that is given.

No-claim bonus: Like every other health insurance plan, the Arogya Sanjeevani Health Insurance Plan also offers a no-claim bonus on every claim free year. The no-claim bonus is applicable as an increase on your sum insured for every year when you don’t put any claim. You get a 5% cumulative bonus on your total sum-insured after every claim-free year. 

Cons of Arogya Sanjeevani Health Insurance Plan:

Restrictions on sub-limits: Despite extensive coverage, the Arogya Sanjeevani Health Insurance Plan has restrictions on sub-limits on the sum insured. It pays only 5% of charges incurred on an ICU/ICCU visit, that too up to Rs.10,000 per day. It also has a cap of 2% on room charges reimbursement, which is Rs.5,000 per day. The common refrain is that most of these limits imposed are actually impractical. These restrictive sub-limits make it difficult to reap full benefit out of the health insurance plan and the policyholder might even end up spending a good amount of money from their own pocket despite paying regular premiums. 

Lack of customization: Although standardization is a hallmark of the Arogya Sanjeevani Health Insurance Plan, the lack of options for customization make it difficult for a policyholder to avail a comprehensive health insurance cover even if they want to. For example, the Arogya Sanjeevani Health Insurance Plan has no options for add-on covers like personal accident covers, critical illness covers and more. 

Lower sum-insured: The Arogya Sanjeevani Health Insurance Plan offers a sum insured from Rs.1 Lakh to Rs.5 Lakhs. This is a low amount especially for people who are at risk of critical illnesses or have more family members. The inflexibility of the Arogya Sanjeevani Health Insurance Plan to accommodate higher sum-insured amounts is one of the major downside risks of the policy. 

In a nutshell, the Arogya Sanjeevani Health Insurance Plan is a good buy for first time health insurance buyers with a lower budget as it is advantageous in terms of being economical and offers decent coverage. However, it falls short with respect to offering a diverse range of options and customizations to the policyholder. Scalability is an issue in the policy.

”Pros

Where can I get an Arogya Sanjeevani Health Insurance Policy for me or my family?

The Arogya Sanjeevani Health Insurance Policy has been introduced by IRDAI in 2020 to make health insurance more affordable and accessible to the masses. Currently it is being offered by 29 health insurance companies in India and all insurance companies registered with IRDA have to mandatorily offer this plain vanilla policy.

Does the Arogya Sanjeevani Health Insurance Policy have any waiting period?

Yes, the Arogya Sanjeevani Health Insurance Policy has waiting periods specific to the kind of ailment. There is a mandatory initial waiting period of 30 days from the date of policy commencement during which no claims will be reimbursed except for those that are caused due to an accident. Post that, there is a waiting period for four years for any pre-existing illness or medical condition.

During this waiting period you will not get reimbursements for treatments related to your pre-existing condition but other treatment claims will be reimbursed at the normal rates. There is also a waiting period of about 2-4 years for coverage of treatments that are specific in nature like cataracts, tonsillectomy, hernias, joint replacement treatment and others.

Are there age-limits or exclusions under the Arogya Sanjeevani Health Insurance Policy?

Yes, there is an entry age-limit for adults and children. For adults, you can buy the policy at a minimum age of 18 and maximum age of 65. For a child to be included in the policy, the youngest age is 3 months and the maximum permissible age is 25 years. The entire list of other exclusions will be available in your policy document, but in a nutshell, these are a few standard exclusions:
Rehabilitation expenses
Obesity treatments
Gender-change treatments
Outpatient treatments
Criminal accidents
Addiction treatments
Treatments abroad
War injuries/accidents
Fertility treatments
Maternity treatments and expenses

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