Common Terms Used For Health Insurance Policies

 B

Benefits : In terms of medical insurance, it is the total amount the insurance company will pay for the medical expenses incurred by you or other family members insured under the terms and conditions of the policy.

 C

Coverage : It is the type and value of medical expenses that you can claim from the insurance company for medical expenses incurred by you or other family members insured under the terms and conditions of the policy. Co-payment: Copayment is the share of the medical bill that the insurer has to pay from its own pocket. For example, in case of a pre-existing illness or if the waiting period for some ailment is low, etc., you have to pay a part of the medical expenses in case you are hospitalised for that illness/ailment. The rest will be paid by the insurer.

 D

Daycare treatment : Certain procedures – like chemotherapy, tonsils, and dialysis, that can be completed in the hospital in less than 24 hours, are daycare treatments. Though the basic requirement for claiming medical insurance is that one has to stay at the hospital for a minimum of 24 hours, there are quite a few daycare treatments that are usually covered in the health policies.

Domiciliary hospitalisation : Domiciliary hospitalisation is when a patient is given treatment at home, but it is treated as hospitalised as advised by the doctor. For example, if there is a lack of beds in the hospital or someone is too old or too fragile to move to a hospital, etc.

 E

Exclusions : It is a list of medical conditions, external environment or healthcare expenses that are not covered under the health insurance policy. You will have to pay for these expenses from your own pocket.

 F

Family floater health insurance : It is a kind of health insurance where more than one member of the same family is covered under the same policy. Under such a policy, you can claim health insurance against treatment for more than one person in your family every year. For example, let’s suppose you have a Rs 10 lakh family floater policy. Now, you were hospitalised and the expenses incurred were Rs 3 lakh which were covered by the insurance. The balance of Rs 7 lakh can be used to cover the medical expenses incurred by another family member covered under the policy.

 G

Group health insurance : When your employer or a professional association you are a member of, etc. provides health insurance to you and other employees, or members of the association, it is a group health insurance.

Grace period : Grace period is the extra few days when you can still pay the premium for your health insurance after the due date is over to ensure that the policy does not lapse.

 H

Health Insurance : A health insurance plan ensures it covers the medical expenses incurred – like hospitalisation expenses, room rent charges, operating theatre, doctor fees, nursing, specialist charges, day care procedures, post and pre hospitalisation etc. – by you or any family members covered under the plan.

 I

In-patient hospitalisation : When the patient stays in the hospital for more than 24 hours, it is considered as in-patient hospitalisation. It is the minimum requirement for the insurer to claim coverage against the medical insurance policy, apart from the few day care treatments covered under the plan. 

Insurance is a subject matter of solicitation : This essentially means that insurance has to be requested or asked for, and it is not sold. This is a mandate by IRDA and found in all insurance advertisements.

Insured : The person or persons named in a medical insurance policy. In case they fall sick and are required to be hospitalised, the insurance company covers the expenses.

 M

Miscellaneous expenses : Medical expenses related to hospitalisation, like X-ray, lab fee, admission fee, etc, which are not covered by the medical insurance policy, are termed as miscellaneous expenses.  Since they are not covered by the policy, you will have to pay for them from your own pocket. These miscellaneous expenses are mentioned in the policy in some form, carefully look for them.

 N

No claim bonus : No claim bonus (NCB) is the way by which insurers reward the policyholders for having a claim-free year. If you have a claim-free year, then you can have a higher coverage (sum insured) amount at the same premium level. The part of the sum assured that can be increased is between 5 to 50 percent. This way you can accumulate enough NCB to increase your sum insured by up to 100 percent.

 P

Policyholder : One who has bought the insurance policy.

Policy Tenure : The stipulated period for which the insurance policy has been bought.

Premium : Monthly or yearly fee you pay for the insurance policy that you have bought.

 R

Restoration : If you were to consume your entire sum insured during hospitalisation/treatment and still need more, then the insurer would add some more coverage without taking any additional premium. This benefit is called restoration. There are some rules around it which are insurer specific, watch out for those.

Rider : A rider is an insurance policy provision that adds benefits. Like if you have bought health insurance, you can buy a critical insurance rider along with it. Now if you are diagnosed with one of the critical illnesses mentioned in the policy, you will be paid the sum assured for the critical illness rider.

 S

Sub-limit : A sub limit is a cap of how much a policyholder can claim for a particular expense/procedure. For example, there is a cap for knee surgery, cataract per eye, etc.

 W

Waiting period : The waiting period is a kind of a hibernation period during which no claims will be admissible. The waiting period might vary between one and four years.