Super top-up health insurance is designed to cover medical expenses that exceed a certain limit the d. Given the continuous rise in medical costs and the complexity of medical tests and procedures today, having extensive medical insurance coverage is crucial. However, while purchasing super top-up insurance is necessary, buyers must be aware of an important limitation.
A top-up policy will kick in only if each claim is above the deductible. A super top-up policy will kick in if the sum of total claims is above the deductible. You can see examples and how to choose a policy here: How to buy a Super Top-up Health Insurance policy. For a personal account, see: Finally got me a Super Top Health Insurance.
If you want to buy a base or super top-up health insurance policy, select the right one with these free resources.
Cashless is more a privilege than a right for any health insurance policy. The hospitalization has to be in a network hospital, and the cost and course of treatment proposed by the hospital should be fairly acceptable to the insurer to allow cashless claims. Moreover, cashless payments can be denied if the insurer or TPA suspects that the cause of hospitalization is a condition not covered by the policy permanently or due to waiting period stipulations.
For a non-network hospital, if the insurer doubts the treatment or illness, they would ask the insured to pay for the treatment and then apply for reimbursement. This means we must pay out of pocket despite having health insurance coverage.
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This can be problematic with a top-up or super top-up insurance cover. Typically top-up claims are handled via reimbursement mode. Only in the rare case where the base and top-up policies are from the same provider and if the insurer is satisfied enough, a top-up cashless claim be entertained.
Consider a “small” base+ top-up combination, such as Rs. 5 Lakh + Rs. 20 Lakh and a total hospital bill of Rs. 15 lakh. Rs. 5 lakhs would be paid by the base cover (say by cashless), and the insured will have to pay Rs. 10 lakhs out of their pocket first and then only claim it back via the top-up or super top-up policy.
Insurers have started offering large top-up policies: Rs. 25/50/75 or 100 lakhs. For a person who is not a crorepati, an Rs. 100 lakh top-up cover may be affordable. However, that entire Rs. 100 lakh health insurance will not be available to him at the time of need.
If the person has only Rs. 25 lakhs net worth, then the effective top-up insurance is only Rs. 25 lakhs, not Rs. 100 lakhs. This is because most top-up claims, especially for such amounts, would be via reimbursement. When the person can only afford Rs. 25 lakhs, the claim would be of that amount only.
Buying super top insurance of several lakhs is undoubtedly a good idea and should be done if the premium is affordable. However, the buyer must first recognise this limitation of handling claims via reimbursement and the need for a comparable liquid net worth to handle expenses.
Opting for a super top-up policy from the same company as the base policy could be a reasonable choice but may limit the total insurance coverage. It must be understood that cashless super-top claims are not a guarantee even in this case – just that the odds are more favourable.
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