Health Insurance: Learn How a Rider Adds Value to Your Health Plan

With rising healthcare costs, a basic health insurance policy may not be enough to meet the needs of an entire family. As the health insurance companies offer endorsements or add-ons such as waiver of room rent, hospital money, critical illness cover, one can opt for them with the health insurance policy of base. Health insurers also offer supplementary policies to meet actual expenses beyond the limit available in the basic policy.

Exemption from room rent
As many health insurance policies have a cap on the room rent, this endorsement will allow an insured to select a room with a higher sub-limit without paying an additional amount. Typically, a 35-year-old insured with an insured Rs 15 lakh sum policy will have to pay around Rs 1,500 more to add this endorsement to the mediclaim policy or opt for a policy that does not cap room charges. In the latter case, the premium will be higher compared to adding the rider to the basic cover.

Hospital cash jumper
This rider will pay the insured a lump sum of medical expenses for each day of hospitalization. Hospitalization must be for a minimum of 48 hours. The fixed cash payment will be one time for the number of days mentioned in the policy and it will not be linked to the actual expenses incurred during the hospital stay.

Critical illness cover
This coverage provides the insured with a lump sum regardless of expenses incurred during medical treatment for diseases such as cancer, heart attack, kidney failure, organ transplant, etc.

After payment of the capital, the insurer terminates the additional endorsement but the basic contract is maintained. Experts suggest that it is always better to opt for a critical illness rider which will help alleviate the financial burden to some extent and the family will not have to dip into the savings built up for long term goals. Additionally, purchasing a critical illness insurance plan at a young age can provide the policyholder with a high sum insured with lower premiums. The policyholder should understand the inclusions and exclusions of the endorsement before purchasing it.

Additional cover
A regular health insurance policy reimburses hospitalization costs up to the insured amount, while a supplemental plan covers costs after a certain threshold is reached. A supplemental plan is available in two versions – individual coverage and floating family, and an insured can purchase supplemental coverage from any insurer. Complementary plans are less expensive than traditional health insurance plans because they only cover above a threshold and can be claimed together for a single hospitalization. There are super supplements, which do not have a single claim limit and can be claimed for any illness that exceeds the deductible amount for the entire year.

Earnest L. Veasey