Health insurance has become an integral part of financial planning for most families and individuals.

However, the debate over how much sum insured is adequate to cover an individual or a family is ongoing. For those who are in doubt that they are not adequately covered under their standalone health insurance plan, or employer’s health insurance scheme, have an option of getting additional coverage through top-up health insurance plans.

Only additional cover:

Top-up plans should be considered only as an additional cover because the sum insured of these plans can only be utilised if the limit of existing base policy has expired. For example, if an individual already has a policy of Rs 5 lakh and buys a top-up policy of Rs 5 lakh; when he incurs a hospitalisation bill of Rs 7 lakh, first Rs 5 lakh would be paid from the base policy and the remaining Rs 2 lakh from the top-up plan. Insurance company asks you to choose a deductible amount for which you already have an existing health insurance policy. Depending on the deductible sum insured chosen, a top-up plan would only provide additional sum insured in case, the sum insured of existing policy is exhausted due to hospitlisation.

Cost comparison:

While buying a top-up plan, the primary consideration should be the annual premium that is to be paid on such plans. Supposing you already have a health insurance plan that covers your family for Rs 5 lakh and you want an additional cover of Rs 5 lakh. Then annual premium for a family of two members from Star Health and Allied Insurance’s Super Surplus plan comes to Rs 4,831, against Rs 7,736 for normal family floater plan. So, instead of spending Rs 15,472 for two separate family floater plans, you can buy a cover of Rs 10 lakh by paying Rs 12,567.

Service satisfaction:

With health insurance business growing at a rapid pace, there are quite a large number of insurers who are offering top-up plans, like Bajaj Allianz General Insurance, Star Health and Allied Insurance, United India Insurance, ICICI Lombard General Insurance and Cholamandalam MS General Insurance. If you are satisfied with your existing health insurer, you can check with them if a top-up plan is available with them or not. Alternatively, if your existing insurer does not offer a top-up plan, you can compare other top-up plans available in the market and pick the right one. With health insurance portability coming into existence from October 2011, you can also switch you existing health insurance provider.

Medical checkup:

Like plain vanilla health insurance plans, some medical tests are mandatory if policyholders are above certain age, as per specific insurance company’s terms. However, if a policyholder has developed certain pre-existing illnesses, he should declare them in the proposal form. “Insurance company might ask for additional medical tests if a policyholder has some pre-existing diseases. Then, as per reports of those medical test, insurance company would either issue the policy, or reject the proposal,” said Suresh Sugathan, head of health administration team at Bajaj Allianz General Insurance.