One of the most important aspects that a policy buyer has to consider when buying a health insurance plan is that of the pre-existing diseases coverage. This becomes especially significant when buying a mediclaim policy for family or a floater plan that covers the policy buyer, spouse, children and aging parents. So find out the meaning of a pre-existing disease, and find the best coverages to choose the best health insurance plan for you.
What does a pre-existing disease mean?
As the term suggests, a pre-existing disease is an illness or medical condition that exists at the time of buying a policy. Conditions such as diabetes, heart disease, and hypertension all fall within theclassification of Pre-existing diseases in case the insured members already have any of these conditions at the time of purchasing the policy. Even chronic conditions such as asthma or skin conditions such as Vitiligo or psoriasis can be considered as pre-existing conditions. A previously sustained injury or accident, a disability or a prosthetic limb may also be considered as pre-existing diseases. Family history and occupational risk factors may also be relevant here. This is because all of these aspects have bearing on the insurance company’s financial risk. The concept of pre-existing disease may vary from one insurance provider to another. For instance, the definition set out in a National Insurance Mediclaim policy could differ from that in an HDFC Ergo or ICICI health insurance policy.
A pre-existing condition means an increased likelihood or chance of a covered person becoming sick and making a claim. Even if the pre-existing disease may not be directly responsible for hospitalization, the condition increases the chances of the patient needing additional treatment or surgical procedures in the future. The chances of complications, extended hospital stays, specialist interventions also rise in such a scenario. Hence the risk outlay of insurance companies rises. As a result, insurance providers are reluctant to offer coverage for such conditions and when they do, premiums tend to risebe higher. It is mandatory for the policy purchaser to give all relevant and accurate details about pre-existing diseases at the time of buying a policy. Failing to do so would amount to fraud that would enable the insurance company to be within their rights to refuse to honor a subsequent claim from the same patient(s). So please ensure that all the declarations made in the proposal from regarding Pre-existing conditions are accurate.
How can you opt for pre-existing diseases coverage?
The best health insurance plan is obviously one that offers the best coverage for the widest range of eventualities including expenses or complications arising from pre-existing disease. Hence, when buying a Mediclaim policy for family members – some of whom could be aged and who are more likely to have developed age related and other ailments – pre-existing disease cover is very important.
The problem here is that some policies do not offer such coverage while some do so after a waiting period of between one and four years (no claim for pre-existing disease would be entertained for the specified period after policy purchase). Typically, plans that offer pre-existing disease coverage are more expensive and require the policyholder to pay a higher premium. In some cases, the insurance company may refuse to renew a policy because of such medical ailments; since the risk of recurrent illness is very high and hence the frequency and amount of the claims made also increases.
The concept of premium loading is also important to understand here. When a policyholder makes a valid claim, subsequent premiums or policy renewals may cost more. Though the IRDA forbids premium loading as a rule, the fine print of a policy may have some loopholes that permit the insurance company to increase premiums indirectly or for some other reason.
If you want pre-existing disease cover to be a part of the policy you buy, choose a health insurance policy that expressly offers such coverage. Read the policy document carefully. Make full and accurate disclosure of medical history, family risk factors and existing medical conditions as well as past accidents, injuries, acute incidents as well as chronic or episodic problems at the time of policy purchase itself. Also be prepared for higher premiums – after all when it comes to health, it is better to be safe than sorry!