Claim settlement is the total payments made by health insurance firms against the total number of claims received by it. If a company has a high claim settlement ratio, it makes sense in buying policy from them.

2. Buying a health insurance cover? Know some
important factors
Medical emergencies can cause some serious financial
crisis. You may have to borrow money from friends or
relative, or keep things like gold, silver, property papers,
etc. mortgaged to arrange necessary finances. Thus, a
medical emergency cause triple hit of physical, mental and
financial stress. Therefore, a health insurance policy is
necessary to protect the financial health and not merely as
a tax savings tool.
Let’s understand few important factors to be considered
while owning your health policy:

3. invests When Young
Young days are the most beneficial days of purchasing a
policy. Since young people are deemed healthier and there
are fewer risks involved you get the policy at a cheaper rate
compared to aging days. Buying a policy with lifetime
renewability makes sense, otherwise if the policy ends at
old age, it will be difficult to get a new one. Additionally,
younger individuals tend to accrue a no-claims bonus as
they are unlikely to seek medical attention.
Cashless Vs Reimbursement
During cashless treatments, the insurance company has a
list of approved hospitals where a policyholder can seek
treatment in these empanelled hospitals at free of costs.

4. Waiting Period
A pre-existing condition is a disease that exists before the
purchase of a health insurance policy. Insurers need to wait for
around 3 to 5 years for the disease to be incorporated in the
plan. If there are two insurance providers and one is charging a
higher premium than the other, but has a shorter waiting
period, then it makes more sense to purchase its policy.
Sub-Limit
It is the extent to which an insurer will pay for claims arising
from associated medical expenses. Your expenses like cost of
medicine or cost of surgery will be limited to an amount
determined in the sub-limit. For example, the doctor’s fees
could be limited to 2% in a health plan worth Rs 4 lakhs. The
insured will, therefore, be paid no more than Rs 8,000, even if
the doctor’s fees amount to Rs 10,000.

5. Claim Settlement Ratio
Claim settlement is the total payments made by health
insurance firms against the total number of claims received
by it. If a company has a high claim settlement ratio, it
makes sense in buying policy from them. But, one should
keep in mind that claim settlement ratios are influenced
mostly due to factors like fraudulent claims.
Cooling-off Period
During the first 30 days, the insurer will not cover the cost
of hospitalization due to illness. The period is termed as
‘cooling-off’ period. However, a policyholder must make
sure that the expenses of hospitalization due to accident
are covered.

6. Review the Policy:
Once a health insurance policy has been purchased, it is
very important to review it from time-to-time and keep an
eye on other providers in the market. Due to the IRDA’s
guidelines on insurance portability, a policyholder will not
have to go through a waiting period for pre-existing
diseases if he/she decides to switch to another insurer. So,
its better to read the policy carefully and utilized them for
your utmost benefit.

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insurance/health-insurance.jsp