The importance of health insurance is well understood by people these days. However, we have come a long way from the one-plan-fits-all scenario to policies that cater to specific needs. Today, a slew of health policies exist that function like add-ons to existing policies that provide specific coverage like critical illness and even personal accident, which all fall under the addon cover list. There are broadly four types of add-ons:
Top-up plans
These can be purchased to increase the quantum of health cover at a low cost by choosing a deductible that matches the sum assured on your primary health cover. So in case of hospital bill exceeding this sum, the top-up will pay for it.
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Super top-up plans
Unlike the top-up plan where the threshold amount has to be met by you at every instance, in case of a super topup, the aggregate cost of multiple hospital visits in a year can be considered to fulfil the threshold requirement.
Critical illness cover
It provides a pre-defined lump sum amount if the insured is diagnosed with a certain ailment. The whole amount is paid irrespective of the medical treatment cost.
Personal accident cover
A personal accident policy is helpful to cover the risk of accidental death by providing a substantial extra cover in the event of death due to an accident which need not be necessarily a road accident.
The top-up plan is by far the most valuable cover that you must have. The top-up plan provides protection over and above a threshold. This threshold is known as the deductible, which means that the insured would pay the sum till the threshold and the add-on will pay for any claim above this sum. For instance, you can opt for a top-up plan of Rs 5 lakh with a deductible of Rs 2 lakh (the sum assured of your policy). So in case you run up a hospital bill of Rs 3.5 lakh, your policy would pay the first Rs 2 lakh, with the topup paying for the sum above this limit, i.e. Rs 1.5 lakh. The advantage of such plans is immense, when compared to the premiums that one would have to otherwise pay for a high sum assured policy.
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