Decoding popular myths around health insurance

Insurance is one of the most-talked-about, yet least-understood domains. Everyone around you – your family, neighbor, friend and colleague – would have an opinion on it without completely understanding it. This lack of awareness gives way to myths related to insurance, rooted in our imagination but not in reality. Let’s have a look at some of the popular myths around health insurance:

Myth 1: Health insurance policies pay only in case of hospitalization

Reality: Generally, we believe that health insurance policy exclusively takes care of hospitalization expenses. This is not entirely true. Your health insurance plan also covers costs associated with doctors’ visits and check-ups, prescriptions, and other treatments that you or your dependents need alongside. Further, expenses related to preventive health care and screenings also come under its ambit.

Myth 2: Health insurance provider cannot be changed

Reality: Today, health insurance is much more flexible and consumer-oriented than before. All insurance companies allow policyholders to port their policies. This is a significant move as it enables you to switch from your existing health insurance plan to the one that meets your changing needs. Also, you can port between zone-based coverage and all-India coverage. Zone-wise classification of health insurance policies can reduce your premium amount by up to 20 per cent, depending on your city of residence. However, note that all the benefits of your existing policy may not be portable, therefore choose wisely while porting.

Myth 3: Health insurance does not cover pre-existing diseases

Reality: Health policies cover pre-existing diseases after certain time has elapsed since buying the policy. This time period (popularly known as waiting period) can vary from months to years depending on the nature of disease and the insurer. Also, if you switch to another insurer, say after two years of buying the policy, your new insurer may choose to consider the waiting period that you have already served.

Myth 4: Health insurance excludes those who smoke or drink

Reality: A recent study revealed that about 49 per cent of individuals who smoke or consume alcohol were less confident about getting a health insurance cover. This statistic clearly indicates how unaware we all are about insurance. Insurers today offer medical cover for individuals who smoke or drink. Although, consider informing your insurer about your lifestyle habits beforehand, so that it does not cause impediment during the claims process later on.

Myth 5: You cannot change mediclaim terms after buying the policy

Reality: You can have the sum insured enhanced at a later stage, depending on your requirement. Alternatively, you could also choose to increase your health insurance coverage by adding a Super Top-Up plan to your existing health plan. The latter, happens to be a much viable option as far as the premium outgo is concerned.

Myth 5: Health insurance is meant for tax savings

Reality: We usually buy health insurance for the purpose of getting tax rebates and not for ‘insuring.’ Owing to this perception, we tend to ignore the working of the policy, which leaves us in utter confusion at the time of making a claim. Also, we may end up buying a plan that does not meet our needs and requirements, thereby leaving us underinsured. This defeats the goal of financially securing your family against spiraling healthcare costs.

(The author of the article is the CEO and co-founder of Policybazaar.com)

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