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Why should you increase the coverage while renewing your health insurance?

Mohit (32-years-old) lives in Ahmedabad with his wife (27-years-old) and daughter (3-years-old). Mohit purchased a health insurance policy of Rs. 3 lakh coverage when he was 24 years old. But this insurance cover is not adequate for his current family of three because now Mohit is married and has one child. Though Mohit has included his spouse and child under the health insurance policy, the coverage amount remains the same. In this scenario, Mohit needs a higher coverage amount (at least Rs. 10-15 lakh) that can sufficiently meet all the growing requirements and needs of the family. New members are added to the policy, but costs of hospitalization and medical inflation are rising exponentially. To cope up with the situation, Mohit should enhance the sum insured every few years.

Many people like Mohit renew their health insurance policies without a second thought. Though it is good that you are covered with a robust health insurance policy year after year, you still need to review every year or two whether your existing insurance coverage is sufficient for your current healthcare requirements or not. Thus, evaluate your health insurance policy at the time of renewal and analyze if it still offers adequate coverage for your changing family and healthcare needs.

Things to consider at the time of renewal

Very often people forget to add new members to their existing policies. This is the thing that you can’t shun during your renewal. You must add new dependents (children, parents, etc.) to your present health insurance plan at the time of renewal. But never add it without weighing the aptness of the health policy with your new family structure.

Two questions that you must ponder at the time of renewal are: “Is your sum insured adequate for your existing family members?” and “Do you want to add any of your new members to your policy and enhance the cover?”

After completing the evaluation of your health insurance coverage requirement, you need to consider certain other factors.

Note the changes in policy terms

Sometimes, the terms and conditions of the policy may change at the time of renewal.

Does health insurance premium increase every year?

Some insurers often enhance your premium based on the number of claims you have initiated during the year. But not all insurance companies follow this. You can check whether your insurer has increased your premium based on your claim history or not. Just open your policy document and look at the claim section or check the section where all terms and conditions are mentioned.

If your insurance provider increases your premium based on your claim history, then you can’t do much except porting with your current insurer. You can opt for porting during renewal. So, analyze every option and take the decision prudently.

Some insurers often increase the cover or/and premium based on the frequency and types of claims made, the applicability of no-claim bonus, etc.

No claim bonus health insurance

No claim bonus is an astounding benefit that a policyholder can enjoy on his health insurance. 

Types of no Claim Bonuses

  • Cumulative Benefit means higher sum insured.  
  • Discount on premium

Most insurers usually offer no claim bonus by enhancing the sum insured for every claim-free year with a set limit for the maximum amount (50% on NCB).

Health insurance premium age slab

Your age contributes a big role in your health insurance premium rate. The premium rate increases once the policyholder gets older, with the largest increases after age 55. The premium could be three times more expensive when compared to the monthly cost for a 21-year-old.

Sometimes, insurers may make changes in the list of network hospitals that might impact your renewal decision. For example, if your preferred hospital is no longer included in the list, you may change the policy.

Don’t forget to mention any new illnesses that you or your family member might have at the time of renewal. However, people conceal these things, always transparent, and reveal this to the insurer. If you hide, then your claim may get declined by the insurer for that particular illness/disease in the future.

Check for new and better options

The health insurance industry is burgeoning rapidly, and every few months, new products/plans are introduced by insurance companies. These new products come with a plethora of benefits and features. Many of these new features are beneficial for you but might not be included in your current plan.

In this scenario, you can port your policy from one insurer to another and enjoy a new policy with add-on features that you are looking for. You might even get a higher cover at a lower premium. While migrating from one insurance company to the other, the policyholder should not lose the policy’s existing benefits like waiting periods, no-claim bonus, etc.

Thus, don’t renew your health insurance policy without gauging your requirements and considering other new options. You don’t want to bear the pain of rejection while initiating a claim in the future. If your policy couldn’t support your claim, then you simply have wasted a chunk of money against paying its premiums.

Suppose you are thinking about how to buy health insurance online in India or renew. In that case, you might be astonished to know that many health insurance companies are now offering their plans online so that customers can conveniently purchase or renew these policy plans. But you should be very careful at the time of renewal so that all your family members are adequately covered with the policy. If your existing health insurance policy does not meet your expectations, discard it and choose another option.

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