Understand Sub-Limits in Your Health Insurance Plan

With insurance companies offering online services, buying a policy has become much easier. But, selecting the right plan to suit your exact needs may be challenging. While you compare plans from different insurers, you may consider several features such as waiting period, co-payment clause, coverage for daycare procedures, cashless claim, etc. However, another critical factor you must consider is the sub-limit.A sub-limit in the health insurance plan is the additional limitation on the policy coverage. In simple words, sub-limit is the monetary cap placed by the insurer on the claim amount. Depending on your policy’s terms and conditions, the sub-limit can be on ambulance fees, bed charges, doctor fees, etc. The insurance companies limit their liability by including sub-limits. A health insurance plan without any sub-limits will have a higher premium, whereas the plan with limitations on coverage will be comparatively cheaper.

In India, most insurers have two types of sub-limits on health insurance plans – sub-limit on room rent and sub-limit on certain treatments.

• Sub-limit on room rent Under this sub-limit option, the insurer will pay for the daily room rent only up to a certain limit. The policy may also have a limitation on the type of room you are admitted to. For example, most insurance companies cover room charges if you are admitted to the general or semi-private rooms. If you need a private room, you may have to pay the additional cost from your pocket.If the room rent in your policy is capped at Rs. 5000 per day, and you opt for a room that costs Rs. 6000 per day, then you must pay the difference of Rs. 1000 during the final bill settlement. Typically, the cost of a twin-sharing room or a general room is much lesser than a private room. Hence it is paramount that you check the sub-limit in your policy while buying the policy to avoid any last-minute hassles while filing a claim.
• Sub-limit on treatments Before you sign the policy documents, you must take your time to review the list of diseases/illnesses that are eligible for full coverage and which treatments come under the sub-limit clause. Even if you purchase a policy with a higher sum assured, you may not be able to claim the full amount due to the sub-limit clause on specific medical procedures.For example, if your health insurance plan has a sub-limit clause of 50% on cancer treatment, then even if your sum assured is Rs. 5 lakhs, the insurer will not pay more than Rs. 2.5 lakhs.

Typically, the insurance companies specify the sub-limit on health insurance plans either as a fixed cost or a percentage of the claim amount. Final Word Experts recommend looking for a health insurance policy with zero sub-limit. Although such plans may have a higher premium, it ensures minimal hassles during a claim. During a medical emergency in the family, the last thing you would want to stress about is arranging funds to pay for the expenses because your policy has sub-limits.

The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.