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Published in Mint on May 14 2017, Written by Abhishek Bondia

I am presently working in Muscat and planning to move to India by July. My daughter met with an accident in Muscat and is currently undergoing treatment in India. My present company is paying the medical expenses after I submit the bills. As I will now move back to India, how should I plan my insurance? Also, I already have a family floater policy, which I opened after the accident. It has a 3-year lock-in for pre-existing ailments criteria. Is there any way to get rid of this pre-existing criteria to get the medical claim paid?

—Jaganath Ganesan
If you move to India with the same company, it is likely that they will have a corporate group insurance policy for India. Typically, group health insurance policies cover pre-existing ailments without any waiting period. You could then claim through your corporate policy itself.
For personal policies, there is always some waiting period for pre-existing ailments. For several policies, the waiting period has come down to 2 years. You could explore such insurances for faster coverage of pre-existing ailments. Do note that pre-existing waiting periods will not be applicable for an accidental injury that took place after the policy started.

Is it necessary that auto insurance should be paid only from the bank account of the policyholder or can anyone pay on the policyholder’s behalf?

—Piyush Narang
Insurers generally do not accept third-party payments and insist that the insured pay the premium from their own bank accounts. In select cases, an exception could be allowed, provided a direct linkage between the insured and the person paying the premium is established. For example, for a car owned by a company, premium paid by the employee could be allowed. Insurers would generally ask for a declaration about the reason for the deviation and relationship with the insured. If the premium amounts are small, then several insurers will accept cash payment as well.

I work as an ophthalmic surgeon in Mumbai. I would have no skill left if my hands were to suffer any damage or deformity. I have at least 30 more years left in which I can safely do surgeries. Is it possible to take out a policy on my hands, as we do for critical illnesses? How will the premium be calculated?

—Chandrakant Bansod
You could buy a personal accident insurance. Personal accident insurance covers accidental death as well as disability. In case you meet with an accident, which leads to a permanent disability—either partial or total—a pre-defined proportion of the sum assured will be paid to you. For example, in case of loss of both limbs, 100% of the sum assured is payable. Such plans typically have a worldwide cover and are valid round the clock. So, even if you meet with an accident while travelling abroad on a leisure trip, the plan would be valid.
You should consider a high sum assured. Most personal accident insurances restrict the sum assured but a few insurers are now willing to offer Rs1 crore or more for the same. Target a sum assured that is 10 times your annual earnings, as this will ensure a reasonable corpus for you if you are disabled.

Between health insurance policies by life insurance companies, stand-alone health insurers and general insurers, which one should I opt for?

—Piyali Parth
Policies offered by life insurance companies are mostly fixed-benefit plans. Whereas the plans offered by stand-alone health insurers and general insurers are primarily indemnity plans. Under a fixed-benefit plan, a specified amount is paid on the occurrence of the insured event. For example, if you were to get cancer, a fixed, pre-specified amount will be paid. For an indemnity plan, actual expenses incurred by the insured are reimbursed. Unless there is a sub-limit in the plan, reimbursement could be up to the full sum assured of the plan.
Broadly, the health insurance plans offered by general insurers and stand-alone health insurers are similar. You should compare individual product features of each plan before selecting a plan. You may refer to the Mint SecureNow Mediclaim Ratings for a suitable plan for your age, family size and sum assured.
If you do not have any health insurance plans currently, I recommend that, first, you buy a standard indemnity-based health insurance plan offered by stand-alone health or general insurers. Thereafter, you should look at supplementing the coverage by a fixed-benefit critical illness plan.