Health Insurance for heart disease
Health Insurance may soon become synonymous with Heart Insurance. Dr J.S. Hiremath, a leading cardiologist from Pune, said at an international conference recently that ‘there is a CAD tsunami in India.’ Statistics bear him out. Studies have shown that not only are Indians genetically predisposed CAD or Coronary Artery Disease, but that India is registering a 12 per cent increase in it’s incidence. Health Insurance, particularly for treatment from heart problems, has never been as important as it is today.
The good and the bad
Fortunately, all Health Insurance policies cover risks from heart disease. Ofcourse, the polices do have first year and/or second year exclusions (diseases developed in the first year or second year of the policy) but heart disease is not included. In other words, this means that if you develop heart disease in the first or second year after you take the policy, it will be covered by the insurance company. That’s the good news. The bad news is that the cost of serious heart problems requiring organ transplants for instance may not be covered under broad-spectrum health policies. This may necessitate buying specialized, expensive policies. Also, if insurance companies are approached too late, when you already suffer from a heart problem, you will be turned away, even if you believe yourself cured. No insurance company covers pre-existing diseases, not right away.
A wide variety of insurance products
The buyer has a wide variety of insurance products to choose from ofcourse, and luckily, the differences between them are not nearly as wide as perceived. Ultimately, the buyer’s decision depends upon how much faith he has in a particular company.
Insurance polices from government insurance companies have been popular in the past. Their MediClaim policy, for individuals up to the age of 75 years, allows the insured to insure themselves for as low as Rs 15,000/-, and up to a limit of Rs 5 lacs. Premium varies according to the age of the insured. The policy provides reimbursement of medical treatment expenses like hospitalization, doctors’ fees, medicines, diagnostic tests and drugs. Treatment that does not need hospitalization like Coronary Angiography or Cardiac Catheterization can also be covered. Government companies also offer Family Floater Plans which cover the family under a single sum, the insured amount being transferable amongst the family members. However these policies have restrictions. There can be limits on pay-outs. For instance, a maximum of 50% of the total expenses incurred for any one illness. Also, the same illness is not covered again if it reoccurs after 45 days.
ICICI Lombard has a Family Floater Plan where the minimum insured sum for 2 adults and 2 kids is Rs 2 lacs, with the premium varying according to age. For example, if the oldest member is between the ages of 56-60, the premium can go up to Rs 14,148 per annum. Lombard’s 10 K Plan, for a minimum of 2 members is for those up to the age of 60, but the policy can be renewed up to the age of 70 years. There is a fixed premium of Rs 10,000/-, but the sum insured varies depending on the age of the insured. For example if the members are below the age of 45, Lombard will offer Rs 5 lacs as the insured sum. If the members are between the ages of 56-60, the insured sum decreases to Rs 2.50 lacs.
Royal Sundaram’s Health Shield offers some extra features like online access to your family’s medical history, reimbursement of ambulance charges and free medical check-ups. It also offers a cumulative bonus on renewal of the policy. However while most other insurance companies cover pre-existing diseases after four years, Royal Sundaram does so after 5 years .
Critical Illness Plans
Critical Illness Plans which cover serious diseases like CAD can be useful for those with a family history of CAD as donor expenses in a transplant surgery are covered, unlike under other health insurance policies. However, these policies can be expensive and pre-existing heart conditions are not covered. National Insurance Corporation’s Critical Illness Policy, meant for individuals between 20-65 years is for a minimum insured sum of Rs. 5 Lacs to a maximum of Rs 25 lacs. The amount can be made available in a lump sum if required.However, compensation is limited to 20% of the limit if a claim is made with respect to Coronary Artery Surgery. Also, the insurance company compensates the insured only once for treatment of a particular critical Illness. It will not compensate even if it is another ‘consequent disease or dependent disease.’ Additionally, if the critical illness appears during the first 90 days of the inception of the policy, the company will not entertain any claim. Bajaj Allianz also has a critical illness plan which covers amongst other things, Coronary Artery bypass surgery, the first heart attack, as well as a major organ transplant. The sum insured can be as low as Rs 1 lac, going up to Rs. 50 lacs. The sum is paid as a lump sum so that treatment can be planned accordingly.
More specialised products
Another specialised policy is New India Assurance’s Overseas MediClaim Policy, meant for travelers up to the age of 70. The premium depends on the age, the length of the trip, and country of visit and claims can be settled abroad in foreign currency. Coverage is initially for a period of up to 180 days but extensions are allowed for an additional 180 days if the insured is still healthy. Medical reports like an ECG and blood sugar from a cardiologist or a physician need to be submitted along with the proposal form in case applicants are over 60 or if they are over 40 and traveling to the US or Canada. And like other insurance policies, no pre-existing diseases are covered.
There are also Life Insurance Plans with health benefits tagged on. These have inherent disadvantages. After a medical claim, the whole structure of the base policy changes and this could result in reduction in future pay-outs and termination of benefits. Future premiums could also be hiked. Some of these terms and conditions might seem unwarranted to the insured, but ultimately, insurance companies have to remain in business and make profits if they have to continue to honor the claims made.
Standard procedures across all Insurance Companies:
Bonus for claim free years.
Premium determined by the age of the insuring person.
Claim only up to the sum insured.
Pre-existing illnesses not covered for a minimum of 4-5 years after buying the policy, whether known or unknown.
No claims for the first 30 days, unless expenses are related to an accident.
Certain diseases, even if developed well into the policy are not covered for 1-3 years, but this does not include heart disease.Some diseases are not covered at all, but again this does not include heart disease.
Family plans do not include old parents.
Health check ups mandatory after the age of 46 years before buying the policy.
Age limits for fresh entrants to the policy, ranging from 60 to 70 years. However if the insured crosses this age, he will be allowed to continuethe policy for a few more years.Premium paid exempt under the Income Tax Act.
(Published in The Times of India in 2006)
A judgement by the consumer court this month (Oct 2006):
It said that if a pre-existing disease is not known to the buyer of the policy, then it is a legitimate claim. However, consumer courts do not have the teeth in this country and it remains to be seen whether insurance companies will follow through on this.
Read more about health insurance and whether it is the answer to your health expenses.