Insurer can’t increase premium due to past claims

Published in Mint on 28th Oct 2014, Written by Abhishek Bondia

My mother is 64 years old and has a mediclaim policy which is seven years in running. There has only been one claim made this year. I plan to increase the cover amount next year and port to another insurer as the present insurer has hiked the premium steeply. How should I go about it?
—Gaurav Sharma

People over 60 years find it difficult to get good health insurance with high sum assured. Insurers are particularly wary if there has been a recent hospitalization. Most insurers will not accept portability requests because all claims would be payable from the first day. It is likely that you will have to continue with your current insurer. However, the good news is that health insurance regulations prohibit the current insurer from arbitrarily increasing your premium due to claims made in the past. Insurers can only stop the no-claim discount (if any), and charge age-based premium. In case the current insurer is not willing to enhance the sum assured, you should consider buying a top-up cover. Unlike regular plans, a top-up plan has a deductible of Rs.3-5 lakh. Any claim above the deductible will be paid by the top-up plan. The deductible amount can be claimed from your current plan.

I understand that a marriage function can be insured. However, will that also cover any kind of loss, say, theft, while in transit from one city to another?
—Laila Kaur

Typically, wedding insurance is based on the principles of event insurance. It covers risks or accidents on the day of the event. So, a theft from the wedding venue is covered but not one during inter-city transit. You can cover transit risk by purchasing a separate marine insurance policy. Buy an all-risk marine policy, technically called Inland Transit Clauses-A marine policy. Clearly specify the mode of transit, basis of valuation and origin or destination. It will cost around 0.5-1% of the sum assured.

What are the most critical things that one should look at when buying a medical policy?
—Bhanuj

You should consider three things—the benefits; the claims record of the insurer; and the premium. The five most important benefits that you should compare are: a) restrictions on room rent, b) disease wise restrictions c) waiting periods for individual ailments and pre-existing conditions, d) co-payment linked to age/disease/general, and e) no-claim discount/bonus.
After doing an initial shortlist of plans based on benefits, you should look at claims track record of the insurer and thereafter premium to finalize a health plan. These parameters have been factored into the Mint Mediclaim Ratings (http://www.livemint.com/mintmediratings ), which you could use to choose a policy.

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