While both kinds of insurance policies provide additional protection beyond the normal health insurance policy, there are significant distinctions between the two, and the decision between them is based on individual requirements and circumstances.
A few years ago, did you purchase health insurance coverage for your family in the range of Rs. 3 to 5 lakhs? The cover amount would have been sufficient at that time, but not in the present day. Permit your employer to insure you and your family for between Rs. 3 and 5 lakhs; alternatively, you may be eligible for coverage of a comparable value through a State Government health insurance programme.
Taking into account the present and anticipated future medical inflation, the coverage amount will be insufficient in each of the aforementioned situations. You may increase your health insurance coverage under these circumstances by purchasing a top-up or super-top-up policy.
What is a top-up health insurance policy?
A top-up health insurance policy provides reimbursement solely in the event that the amount of the claim surpasses a predetermined threshold. The quantity that is designated as a deductible. Consider the scenario in which you have purchased a supplementary health insurance policy for Rs. 10 lakhs with a deductible of Rs. 5 lakhs. The top-up policy will only provide compensation if the quantity of the claim surpasses Rs. 5 lakhs. The following scenarios should be taken into consideration regarding claim payment.
The sum of the claim in Scenario 1 is four lakh rupees. Due to the fact that the claim amount of Rs. 4 lakhs is less than the deductible amount of Rs. 5 lakhs, the top-up policy will not provide any reimbursement.
The amount of the claim in Scenario 2 is Rs. 6 lakhs. One lakh rupees will be paid under the top-up policy (deductible amount of five lakhs minus claim amount of six lakhs). If another claim of Rs. 3 lakhs is filed in the same year, the top-up policy will not provide any compensation because the claim amount is less than the deductible of Rs. 5 lakhs.
Several situations were presented at the outset of the article in which the quantity of health insurance coverage was insufficient. One possible course of action is to purchase an additional health insurance policy. The deductible threshold can remain at the sum insured amount of your personal health insurance, corporate health insurance, or government health insurance.
As an illustration, suppose you currently possess a health insurance policy that insures a sum of Rs. 5 lakhs. You desire an increase in coverage to 20 lakh rupees. You may purchase a top-up policy with a sum insured of Rs. 20 lakh and a deductible of Rs. 5 lakh in this instance.
To qualify for payment under a top-up policy, each claim must exceed the deductible amount throughout the policy year. In the event that one has depleted their personal health insurance coverage and a subsequent claim is less than the deductible amount, what should be done? Under these conditions, the top-up policy will be void. An extremely top-up health insurance plan may be of assistance in this situation.
What is a super top-up health insurance policy?
A top-up policy and a super top-up policy are comparable. However, one significant distinction exists. To be reimbursed under a top-up policy, each claim must exceed the deductible amount. In a super top-up policy, however, the total of all claims made in a given year is taken into account. In the event that the total amount of annual claims surpasses the deductible, the claim shall be compensated.
As an illustration, suppose you have purchased a Rs. 10 lakhs extraordinary top-up health insurance policy with a Rs. 5 lakhs deductible. The super top-up policy will be repaid in this scenario, provided that the cumulative value of claims made throughout the year exceeds Rs. 5 lakhs. The following scenarios should be taken into consideration regarding claim payment.
The sum of the claim is six lakh rupees. One lakh rupees will be paid under the super top-up policy (deductible amount of five lakhs from claim amount of six lakhs). The super top-up policy will reimburse a subsequent claim of Rs. 3 lakhs in the same year, since the sum of the two claim amounts (Rs. 6 lakhs plus Rs. 3 lakhs) exceeds the deductible of Rs. 5 lakhs.
It should be noted that in the aforementioned illustration, had you purchased a top-up policy rather than a super top-up policy, the second claim would have been denied due to the fact that the claim amount (Rs. 3 lakhs) is less than the deductible amount (Rs. 5 lakhs).
Therefore, an super top-up plan is advantageous for those who are afflicted with a condition that necessitates hospitalisation on a recurring basis throughout the year.
Importance of Buying Super Top-Up & Top-Up Health Insurance
Now that you have a thorough understanding of both of these health insurance policies, we will discuss the rationale behind selecting super top-up and top-up health plans:
Rising Healthcare Inflation
Healthcare inflation has reached an all-time high, affecting both urban and rural areas of the nation. In such circumstances, the financial security provided by a top-up or super-top-up plan can be extremely beneficial. If an individual’s current health insurance coverage is exhausted, a health insurance top-up plan may be utilised to augment the coverage and provide inflation protection.
Further cost savings
Super top-up and top-up insurance policies offer a more cost-effective alternative in comparison to purchasing a brand-new individual health insurance policy. Enhanced coverage is available to provide increased protection without the need to pay higher premiums.
High Sum Insured
Changing your current plan to one with a higher sum insured may not always be possible. A top-up or super-top-up policy offers supplementary protection in excess of the policyholder’s existing coverage threshold. Additionally, remember the affordable premiums!
Supplementary Coverage for Seniors
Using top-up or super-top-up plans, senior citizens can obtain comprehensive coverage without having to pay exorbitant premiums. Therefore, this type of insurance policy affords senior policyholders the opportunity to acquire protection at economical premiums.
Preferences for Tax Savings
By claiming tax benefits for both super top-up and top-up policies, you can now save money on your taxes. Section 80D of the Income Tax Act of 1961 provides a straightforward method for individuals to claim the premiums paid for an insurance plan.
Who Should opt for Super Top-Up and Top-Up Health Insurance?
While top-up and super-top-up health insurance plans are applicable to all individuals, certain specific groups should strongly consider selecting one:
Policyholders Having a Low Health Cover
Potentially, your insurance requirements may evolve over time. You ought to contemplate selecting a top-up or super-top-up plan if your current health plan fails to adequately cover your medical responsibilities. This will increase your coverage without requiring you to purchase a new health plan or transfer an existing one with a higher sum insured.
Elderly citizens
Because they are more likely to incur greater medical expenses throughout the policy year, senior citizens require greater coverage. As a result of the elevated cost of premiums associated with advanced age, senior citizens may find top-up and super-top-up insurance plans to be highly profitable alternatives.
Individuals Who Raise More Claims
Top-up and super-top-up plans are essential if your health insurance plan falls short of covering the number of claims you typically submit. They augment the coverage amount beyond that of the existing policy and are economical. Consequently, you can obtain medical care without concern during the policy period.
Corporate Personnel
Should you already be enrolled in an employer-sponsored group health insurance plan, supplementary and super-supplementary plans will adequately fulfil your insurance requirements. After the maximum amount insured provided by group insurance has been claimed, additional costs can be covered through the use of extraordinary top-up plans.
What’s Covered Under Super Top-Up and Top-Up Insurance
The following items are covered by top-up and super-top-up health insurance policies:
Pre and Post-Hospitalisation – Both pre-hospitalization and post-hospitalization expenses, including diagnostic tests, imaging, blood tests, and follow-up visits, shall be provided coverage under the policy.
Day-care Procedures – Under the coverage of the insurer are treatments or procedures that do not necessitate hospitalisation for a duration of 24 hours.
Road Ambulance Coverage: Top-up and super-top-up plans provide road ambulance coverage to protect against the financial burden of emergency road ambulance expenses.
ICU Room Rent – Additional coverage for the room rent in an intensive care unit is provided by the insurance policy.
In-Patient Treatment – Inpatient treatment includes the costs associated with an operation theatre, nursing staff, anaesthesia, the physician’s fee, and other relevant expenditures. These items are reimbursed by the insurance provider.
What’s Not Covered Under Super Top-Up and Top-Up Insurance
Exclusions from top-up and super-top-up health insurance include the following:
Pre-Existing Ailment – Insurance claims pertaining to pre-existing conditions will not be provided coverage under the plan until the relevant waiting period has elapsed.
Self-Inflicted Injuries – Hospitalisation expenses associated with self-inflicted injuries or suicide attempts are not provided coverage.
Lifestyle Diseases – Medical expenses attributable to lifestyle diseases, such as excessive alcohol consumption leading to liver cirrhosis, are not encompassed within the policy.
Dental Treatment: With the exception of incidental harm, dental procedures are not covered by the health insurance policy.
Waiting Period – Healthcare expenses that are accrued throughout the interim period.
Plastic Surgery – Plastic surgery, including all cosmetic treatments, is not provided coverage by the insurer.
Sexually Transmitted Infections (HIV/AIDS)—Expenses associated with sexually transmitted infections are not covered by health insurance.
Super Top-Up Health Policy – Advantages
Covers pandemics – The ongoing impact of the COVID-19 pandemic on our lives has created an atmosphere of uncertainty. Furthermore, the super top-up policy provides coverage for costs associated with COVID-19 treatment, in addition to other ailments.
Deductibles have to be paid only once – With an super top-up policy, the deductible payment is mandatory only once. You are then permitted to claim multiple times per year, if necessary.
Can be customized as per your healthcare needs – This enables you to select the deductible amount permitted by the insurance provider and the sum insured from Rs. 10 lakhs to Rs. 20 lakhs.
No restriction on room rent – There are no room rental restrictions; each guest has unique preferences. You may receive medical treatment at a network hospital of your preference without having to be concerned about the payment of room rent.
Easy online processes – The entire process, from purchasing the super top-up health insurance policy to submitting claims, is conducted electronically. This signifies that no documentation is required. Hard copies are not necessary, even when submitting claims.
Here are some key distinctions:
Single Claim vs Cumulative Total: A super top-up plan is applicable when the total expenses of multiple claims in a policy year surpass the deductible, whereas a top-up plan is only applicable when a single claim surpasses the deductible.
Scope of Coverage: Coverage is typically more limited with a top-up plan compared to a hyper top-up plan. To illustrate, suppose you require hospitalisation for three times in a year, with each visit costing Rs. 3,00,000, Rs. 4,00,000, and Rs. 5,00,000; your deductible is Rs. 4,00,000. In this case, your top-up plan will provide coverage exclusively for the third visit.
In contrast, an super top-up plan incorporates a cumulative amount of Rs. 10,00,000, thereby ensuring coverage for such expenditures.
Cost Comparison: Super-top-up plans are typically more expensive than top-up plans because of the distinction in coverage area.
Suitability: Those in relatively good health may find a top-up plan to be adequate. Nevertheless, in the case of a chronic medical condition, a super-top-up plan would be more advantageous.
In conclusion
Having compared top-up and super-top-up health insurance must have aided in your comprehension of their respective benefits and applicability. Now that you are aware of how health insurance claims are processed under both of these plans, you can select the one that best meets your needs. In order to ensure that you select the appropriate insurance backup, we recommend that you assess your insurance needs and make a decision between the two options accordingly. You can secure yourself against medical emergencies and prioritise your health without having to concern about your finances by utilising a top-up or super-top-up plan. However, compare plans online to find the most comprehensive coverage and a reasonable premium price.