Can I buy a top-up policy from a different insurer?

I have a family floater mediclaim policy of Rs 3 lakh from Oriental Insurance. I want to buy a top-up cover of Rs 7 lakh. Can I buy it from a different insurance company since Oriental does not have top-up policies?
-Rajesh

Yes, you can buy a top-up policy from a different insurance company than the one from whom you've bought your base plan. In fact, you can buy a top-up even if you don't have a base plan at all.

We would rather suggest you to consider a 'super top-up' policy instead of a top-up policy. The former is far better. The difference between the two is that under top-up plans, deductible limit applies afresh to each claim whereas, under super top-up plans the deductible applies to total admissible medical expense incurred during the year. Top-up plans work on 'per claim' or 'per single hospitalization' basis, they are beneficial as long as the single claim amount is above the threshold limit.

For example, if Mr. X has a top-up plan and a super top-up plan with Rs 3 lakh deductible. Now, say, 2 claim arises in a year - the first one of Rs 2.5 lakh and the second one of Rs 2 lakh. The top up policy, due to its nature, will not pay out anything in either case (because none of the individual claim exceeds Rs 3 lakh). However, in super top-up the total of both claims will be considered for the deductible and hence in the second claim Rs 1.5 lakh (2lakh+2.5lakh-3lakh) will be paid out.

Super top-up plans cost more than the top-up plans but in our opinion, the benefits outweigh incremental cost as explained above.

This article was originally published on December 27, 2016.