A quick look at the amazing new changes in Mediclaim Policies

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A quick look at the new changes in Mediclaim Policies
Health insurance plans have always been a necessity of the life. A while ago, to buy any plan or renew your existing plan was a herculean task. Even renewal of it after certain age (say 58 or 60) was not possible. Nevertheless, after Oct.1, 2013 things have certainly changed. Come let us take note of these changes.

1) IRDA has made it compulsory for all insurers that they should follow the standard definitions for commonly used terms in health insurance policies like critical illness, pre-authorization , list of excluded expenses in hospitalization, so that product standard will be equal across all insurers and no one will be cheated by hidden agendas of companies.

2) Earlier, renewal/buying of a health insurance policy after retirement was almost impossible. Now you can opt for health insurance until the age of 65 years. Not only that, if you have any policy and want to renew it further, then nothing to worry, as heath policies now are renewable for life-time. However, remember that, this is not applicable to critical illness plan because as soon as you claim for the critical illness, the plan terminates immediately after that.

3) As things related to health insurance product are standardized now. Loading on renewals is also standardized and is not based on individual policies. Besides that, it is obligatory for an insurer to settle the claim within 30 days after arrival of the last ‘necessary' document.

4) Now days, 15-day free-look period has been introduced. So, if you happen to buy a new policy then you will get extra 15 days to decide whether you still want to go with the product or not. If you think that the product is not suitable for your needs then you can surrender the policy and get your cash back.

5) Earlier, whenever premium due date was skipped, policy used to be terminated. However, in this area also some respite has arrived. 30 days grace period after premium due date is standardized now. Your policy will not be terminated until grace period gets over but you will not be covered by your policy during those days.

6) Suppose you have two health insurance policies and you need to make one claim only. Earlier, it use to be very difficult to do that. Now, if you have 2/3 different policies from different insurers then also you can make entire claim with one of them.

7) And most important of all is that now third party administrators will only process the claim but claim settlement /rejection will be done by insurers themselves. This has brought more transparency and clarity to entire procedure.


The author is Ramalingam K, an MBA (Finance) and Certified Financial Planner. He is the Director and Chief Financial Planner of Holistic Investment Planners (www.holisticinvestment.in) a firm that offers Financial Planning and Wealth Management. He can be reached at ramalingam@holisticinvestment.in

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