5 Tips on Making the Most of Health Policy Top-Up Plans

To get the most from your health policy top-up plan, select the correct deductible, choose super top-up, purchase it when you're young and healthy, complement your base health insurance, and understand how the deductible works so your claim isn't affected.

What is a health insurance top-up plan?

A health insurance top-up plan gives you extra financial protection when a hospital bill goes beyond a certain amount, called the deductible.

For instance, consider that you have a top-up plan worth Rs 10 lakhs with a Rs 3 lakh deductible. In case your hospital bill stands at Rs 8 lakhs, then the balance of Rs 5 lakh is covered by the top-up plan. The initial Rs 3 lakh can either be paid by your primary health insurance plan, your corporate health insurance plan, or out of your pocket. If the hospital bill stands at Rs 2.5 lakhs, your top-up plan will not pay anything, as your hospital bill is below the deductible of Rs 3 lakhs.

1. Choose the right deductible for a health insurance top-up plan

Make sure the deductible amount matches the existing health insurance coverage. It is because if the deductible amount is higher than your existing cover, you will have to pay the additional cost yourself until the top-up plan kicks in.

Here is how a Rs 12 lakh hospital bill would be shared if you have a Rs 5 lakh base health policy:

2. Choose a super top-up

A super top-up health insurance plan works almost like a regular top-up, but with one important difference:

• A regular top-up looks at each hospital claim separately.

• A super top-up adds up all your eligible hospital bills during the policy year. Once the total expenses cross the deductible, it starts paying.

Here's an easy example. Suppose you select a super top-up sum insured of Rs 10 lakh with a deductible of Rs 3 lakh. During the year, you have three hospitalisations:

• After the first claim, your total medical bills are only Rs 2 lakh, so the super top-up doesn't pay.
• After the second claim, your total reaches Rs 4 lakh. Since the deductible amount is Rs 3 lakhs, the super top-up makes a payment of Rs 1 lakh after the deductible amount.
• The deductible is fully met for the year. Therefore, at the time of the third claim of Rs 5 lakhs, the super top-up covers the entire amount.

3. Get a health insurance top-up plan when you are young

It is advisable to get a health insurance top-up plan when you are young and healthy. This way, you will purchase it at a low premium rate.

When you decide to get a health plan after developing a health condition, things can get more complicated. The premium is likely to be higher, you may have to wait before claims for pre-existing conditions are covered, and in some cases, the condition you're worried about may not be covered at all.

4. Match the health insurance top-up plan with your base health insurance policy

A top-up plan works best when it complements your existing health insurance policy.  

If the two policies don't work well together, you could end up paying part of the hospital bill yourself, even though you have enough overall coverage.

5. Claim a health insurance top-up plan without mistakes

Most rejected health insurance top-up claims come from a handful of avoidable errors, not from the insurer refusing a genuine claim. Keep these in view:

• Don't expect the top-up to pay from the first rupee. It only starts paying after the deductible is met.

• Not declaring pre-existing conditions honestly at the time of buying can void the claim later.

• Missing the intimation window. Inform the insurer within the stated time for planned and emergency admissions.

• Don't let your health policy lapse. Renew both your base health policy and top-up plan on time. Any lapsed policy may affect your claim.