My parents have a basic mediclaim policy from New India Assurance. These are individual policies of Rs 3 lakh for my father (70) and Rs 2.5 lakh for my mother (63), which have been in force for over 15 years. Their initial coverage was Rs 1.5 lakh each which has increased over the period. I want to buy a Top Up policy of Rs 5 lakh for them. Please suggest such a policy for senior citizens.
-Rajat Somani
Top up policies pay for medical expenses that are beyond your reach. The amount at which you want the policy benefit to commence is decided by you, at the time of purchase. This amount is called threshold limit. A top up policy pays medical expenses only in excess of the threshold limit.
It is good idea to buy a top up cover for senior citizens, because our dear ones are most vulnerable at this age. These policies cost less than a basic health insurance policy fund are meant to cover hefty bills.
There are two types of top up policies in market- those which apply threshold limit on each hospitalisation, and those which sum up annual medical expenses to reach the deductible limit. Insurance company pays the claim when deductible limit is breached.
It is better to go for the second type of top up policy, because although expensive, these offer better risk coverage. Based on the age and coverage required, United Super Top Up is a suitable policy. You can select threshold limit equal to sum assured of your parent's basic health cover. Annual premiums at your parent's age for a Rs 5 lakh sum assured with Rs 2 lakh threshold limit, amount to Rs 4,000. The premium would go up to Rs 6,400 if two family members are insured under the same policy.
Similarly, if you want to raise the threshold limit to Rs 3 lakh for the same sum assured of Rs 5 lakh, the premium would amount to Rs 3,200 for an individual, and Rs 5,100 for a family of two.
The premium rates will also depend on the general health of your parents. The company will medically assess your parents before insuring them.
This article was originally published on December 06, 2013.
Ask Value Research 
New episodes every Friday 
New Process Alert 
Seems like you've uploaded a wrong QR code. Please upload the QR code downloaded from MF Central platform.
