Moving from a ₹10 lakh to a ₹1 crore health insurance cover is not as expensive as you think

• Usually, the higher coverage policies such ones for ₹1 crore do not have any sub-limit.
  
• A ₹1 crore cover protects you from any kind of eventuality, and gives you peace of mind.
  
• Moving from a ₹10 lakh cover to ₹1 crore does not bring 10X the cost to the consumer – it only costs 25-30% extra.
  

In the last few years, an assured sum of ₹5 to ₹10 lakh in health insurance is often not enough for a family of three to four members. The main reason for this is India’s high medical inflation – which stands at 14%, as per a Motilal Oswal Financial Services report. Also, during Covid, when more than one family member fell ill at the same time, and had to be hospitalised, it was found that a family floater health insurance of ₹10 lakh was insufficient.

What is the right quantum of health insurance cover that one requires? Also, in recent times, health insurance companies have been offering ₹1 crore covers at a reasonable premium. Do you need one?

Types of ₹1 crore covers available

It is important to understand the types of ₹1 crore sum assured health insurance products available in the market.

Such products in the market are available as combinations of base ₹10 lakh plus ₹90 lakh super top-up coverage, or a ground up ₹1 crore product. Super top-up health insurance works by providing additional coverage when the medical expenses exceed the threshold limit set in the primary health insurance policy, offering an extra layer of financial protection for the policyholder. The super top-up kicks in only when the base cover is exhausted.

“A lot of insurance companies have now launched covers which are a combination of a base policy of ₹10 lakh and ₹90 lakh super top-up. So, essentially, the customer is getting a coverage of ₹1 crore. And since it is from the same insurance company, a customer can also get cashless treatment, and can have a completely hassle-free claim settlement,” says Siddharth Singhal, business head-health insurance, Policybazaar.com, an insurance aggregator. Policies with a super top-up, are of course, slightly cheaper.

There may be some terms and conditions differentiations when one opts for base plus super top-up combination. “One should be careful at the time of purchase for consistency in terms and conditions. There are options available in the market which are ground up ₹1 crore coverage and do not put any restrictions of room rent, 100% bill payment, and even provide day one coverage for buyers,” says Rupinderjit Singh, vice president - retail health, ACKO.

The room rent limit in health insurance refers to the maximum amount that the insurance policy will cover for hospital room charges during a patient's stay.

Usually, the higher coverage policies such as ₹1 crore do not have any sub-limit like room rent limit. “So, opting for such policies saves one from partial claim settlement,” says Rakesh Kaul, chief distribution officer, Zuno General Insurance.

Should you go for a ₹1 crore cover

There are few factors which decide the sum assured required for one's family like: number of family members, location of residence, quality of healthcare desired (whether top hospitals should be part of the hospital network). Cancer treatment in India can cost anywhere between ₹25-₹30 lakh or even higher. Many are often forced to sell off their assets to pay off such large medical bills.

“At the time of claim, to settle such a large amount is almost impossible for a middle-class, or even an upper-middle-class family. A ₹1 crore cover protects you from any kind of eventuality and I would recommend anybody to look for it,” says Singhal. Floater plans, which cover the family members under a single sum insured are also very popular. “One should consider a ₹1 crore cover on a floater basis,” says Kaul.

A health insurance contract is a long-term contract extending to 15-20 years. “India also witnesses high rates of lifestyle diseases. One can choose to have lower sum assured right now but once one gets a lifestyle disease in the future, insurance companies may not allow one to increase their sum assured to higher ones like ₹1 crore. A ₹1 crore sum assured safeguards a consumer and allows him to live worry free and not bother about their health cover at all,” says Singh. He says that, essentially, a family of four, with the eldest member being above 35 years of age should go for a higher cover between ₹25 lakh-₹1 crore.

How much does a ₹1 crore cover cost

One may feel that the cost of a ₹1 crore cover would be much higher than a ₹10 lakh cover. However, that is not the case. “Moving from ₹10 lakh cover to ₹1 crore does not bring 10x the cost to the consumers. It is only 25-30% extra cost,” says Singh.

Premiums for health insurance policies with ₹1 crore sum assured

To sum up, a ₹1 crore health cover may cost you a few thousand rupees extra, but it’s sure to bring you peace of mind in case of any health eventuality.