Add-On Health Insurance
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Add-On Health Insurance
A standard health insurance policy may not cover every health-related expenditure. There are many varied medical procedures that cannot be covered in a single comprehensive health insurance coverage. This is when an add-on health insurance comes into the picture. You can buy these add-on health insurance covers with your base policy to enhance its coverage. In this blog, let us delve into the details of add-on health insurance covers, their meaning, types, benefits and much more.
Health Insurance Add-on Covers
Health insurance add-on covers are not part of a base policy but are additional benefits that are used to increase the coverage of your existing health insurance policy on payment of an additional premium. Add-on health insurance covers are an economical way of increasing the sum insured or the benefits of your existing health insurance plan. These add-on covers can be added to a policy as and when required. According to IRDAI regulations, the total premium for add-on covers cannot exceed 30% of the premium of your existing health insurance policy. These add-on covers can be added while buying the base policy or while renewing the policy. These are a great way of upgrading your existing policy to suit the changing healthcare needs of your family.
Different Types of Add-On Health Insurance Covers
Here are different types of add-on health insurance covers available in India that can add value to your existing plan. All these add-on covers offer different benefits. It is important to understand these benefits to make an informed decision.
1. Critical Illness Cover
This add-on cover provides a fixed benefit in the form of a lump sum amount if the insured is diagnosed with a covered critical illness like cancer, kidney failure, cardiovascular disease, etc. The payout is given irrespective of the medical expenses and can be used for any purpose without any restrictions.
2. Personal Accident Cover
This add-on cover provides compensation for hospitalisation, disability or death due to an accident. It pays a lump sum amount for injuries, permanent or temporary disability or death caused due to an unforeseen accident.
3. Maternity Cover
If you are planning to start a family in the near future, it is a must-have add-on cover to add to your existing plan. Note that there is a waiting period of 2 to 4 years before you can claim any benefit. This add-on covers all the expenses related to pregnancy and childbirth.
4. Hospital Cash Cover
This add-on cover provides a daily cash allowance to the insured during hospitalisation as per the limit specified in the cover. It is helpful in covering daily expenses during hospitalisation such as travelling, food and other medical expenses not covered in the existing health insurance plan.
5. Room Rent Waiver
This add-on cover increases the room rent sub-limit of your existing health insurance policy. It lets you opt for no sub-limit for room rent. With the help of this add-on, you can upgrade your hospital room without spending anything out of pocket.
6. OPD Care
This add-on covers the costs of OPD consultations and follow-ups up to the limit specified in the policy. It helps you save a lot of money on regular doctor visits, diagnostic tests, etc. Note that, this cover is available on a reimbursement basis.
7. Sum Insured Restoration
This cover restores your sum insured if it is exhausted during the policy period. It restores the entire sum insured. In some policies, restoration is allowed only once in a policy period.
8. AYUSH Cover
This add-on offers coverage for hospitalisation to undergo alternative treatments. The treatments taken at a government-recognised AYUSH hospital or healthcare centre are only covered. Some health insurance policies offer AYUSH treatments as an in-built cover and for those which do not cover AYUSH treatments, this add-on cover can be added.
9. International Coverage
This add-on covers treatment outside India at network hospitals on a cashless basis. It is a useful add-on cover for people who travel overseas frequently.
10. PED Waiting Period Reduction
All health insurance plans have a waiting period for pre-existing diseases and a claim can be made only after completing this waiting period. This optional add-on cover can help the insured in reducing or waiving this waiting period on payment of extra premiums. This is a good option for people having a pre-existing disease.
11. Zone upgradation
This add-on provides additional financial support if the insured avails treatment in a city from a higher zone. It helps in enhancing the limits and reducing the co-payments for medical services availed in a higher zone city.
12. Air Ambulance Coverage
During a medical emergency, if the insured needs treatment in a city different from his resident city, the expense of an air ambulance is covered under this add-on.
13. International Second Opinion Cover
If the insured wants to seek a second medical opinion outside India, this add-on cover helps in arranging an international consultation and covers its cost. Note that the policy specifies a list of diseases for which the insured can opt for an international second opinion.
14. No Claim Bonus Shield
No claim bonus is the cumulative bonus you get for every claim-free year. In case you file even a small claim, you will lose this bonus, so to protect your accumulated NCB, you can opt for this add-on cover. Different insurers have different claim amounts specified for which you can protect your NCB.
15. Home Care Cover
This add-on covers the cost of treatment taken at home. This includes expenses for doctor visits, diagnostic tests and nursing charges. The coverage varies across insurers and there are certain conditions to be fulfilled to avail of this add-on. A minimum of 72 hours of homecare treatment is required to file a claim and conditions specified by the insurer are covered only.
16. Co-payment Waiver
This is a useful add-on for senior citizens, where co-payments are usually high going up to 30% of the claim amount. When you add this rider to your existing policy, you can get your co-payment waived on payment of an additional premium.
17. Top-Up Cover
If you feel your existing health insurance coverage is not sufficient, you can add a top-up cover to your base policy. It will provide an additional sum insured once your existing sum insured reaches its threshold. In simpler words, if your claim amount is more than the sum insured by your existing policy, a top-up add-on cover can be used to pay for the remaining amount. It is an economical option compared to opting for a plan with higher coverage.
Best Health Insurance Add-on Covers in India
The table below lists some of the best health insurance add-on covers in India.
| Add-On Cover | Health Insurance Plan Offering the Add-On | Features |
| Maternity and Newborn Baby Cover | Care Plus Youth Plan | Coverage is available according to the sum insured opted as specified in the policy |
| Reduction in PED Waiting Period | Care Advantage Plan | Waiting period of 4 years is reduced to 2 years |
| Room Rent Waiver | Bajaj Allianz Health Guard Policy | Waives off room type restriction for SI options of ₹ 5L and ₹ 7.5L |
| Top-Up Cover | Tata AIG Medicare Plus | SI upto ₹ 1 crore |
| OPD Cover | Aditya Birla Activ Fit Plan | Up to ₹ 20,000 |
| International Coverage | ICICI Lombard-Complete Health Insurance Plan | Available with SI of ₹ 25L and above |
Benefits of Including Add-on Covers in Health Insurance
Buying an add-on health insurance cover can be beneficial in a number of ways.
1. Customisation
Add-on health insurance covers help you customise your existing health coverage according to your requirements without changing your policy at affordable premiums. The insured has full freedom to customise health insurance coverage according to changing needs.
2. Enhanced Coverage
Add-on covers enhance the coverage of your existing health insurance plan by adding more benefits to it. You can add benefits and enhance coverage to fulfil your medical needs.
3. Affordable
Buying add-on covers is much cheaper than buying a new health insurance policy because IRDAI has put a cap of 30% of the base policy premium, on the cost of add-on covers. This means that no add-on cover can cost more than 30% of the cost of your base health insurance policy.
4. Tax Benefits
The premiums paid for add-on covers are eligible for tax benefits under section 80D of the Income Tax Act. As these premiums are added to the premium of the base policy, it becomes eligible for tax deductions.
Need for Health Insurance Add-ons
Health emergencies are unpredictable and can happen to anyone. Sometimes your existing health insurance coverage may not be sufficient to cover unexpected medical expenses. Hence, you need to review your coverage from time to time and include additional benefits to supplement the existing coverage according to the changing medical needs and costs. Here are some reasons why you need health insurance add-ons.
1. Coverage for specific conditions
Health insurance add-ons let you include coverage for certain conditions that are not covered in your base health insurance policy. For instance, your existing policy may not cover critical illnesses but you have a family history of such ailments, so adding a critical illness rider will give you the additional coverage at a much more affordable cost.
2. Coverage above your health insurance plan
Add-on covers offer coverage beyond the basic covers of your health insurance plan like coverage for non-medical expenses, OPD consultations, reduction in PED waiting periods, etc. These benefits are often not included in a standard health insurance policy but are required by many policyholders. Hence, using a specific rider you can widen the scope of your health insurance coverage.
3. No need to buy a separate policy
Buying add-on covers is a cost-effective way of increasing coverage without the need for buying a separate policy for additional benefits. It becomes difficult to manage multiple policies, their premiums and coverages. You can include any riders in your existing policy as per your requirements and can have all the benefits under a single policy.
4. Reduces out-of-pocket expenses
Most health insurance plans have certain exclusions, for which no coverage is provided. An add-on cover lets you add benefits that are excluded in your policy thus reducing your out-of-pocket expenses. For instance, room rent waiver, co-payment waiver, top-up plan, hospital cash etc.
Things to Remember When Buying Add-on Health Insurance Covers
To understand the overall impact of the changes in terms and conditions, costs and coverage of the policy, it is very important to consider certain factors before you decide to include add-on covers to your health insurance policy.
1. Premium
First, calculate the extra premium before adding riders and make sure it fits your budget. Also, note that as per IRDAI regulation, the total premium of all the add-ons must not be more than 30% of the premium of your base policy.
2. Coverage limit
Most add-on covers have a coverage limit which is either a fixed amount or a percentage of the sum insured of the base policy. Hence, understand the coverage thoroughly before buying and see to it that it meets your requirements.
3. Waiting period
Many add-on covers come with a waiting period which you need to complete before filing a claim. Check the features carefully to avoid claim rejection in future.
4. Exclusions
Add-on covers also have certain exclusions, for which no coverage is provided. Check the list of exclusions before you buy an add-on cover to avoid any claim issues at the last moment.
Conclusion
Add-on health insurance covers are a great way to fill gaps in your health insurance policy. It overcomes restrictions and prevents financial burden on the insured. However, you should be mindful of your needs and budget before you add these additional benefits. Do not add all the optional covers that are available, include only those that are relevant to your medical needs. Understand the terms and conditions so that you don’t have to face any claim rejections in future.
Frequently Asked Questions
No, it is not mandatory because add-on covers are optional covers, you can add them to enhance coverage if you need additional benefits.
Yes, you can get a cashless settlement for an add-on cover, if you avail treatment at a network hospital.
You can include add-on covers in your health insurance policy at the time of buying or at the time of policy renewal.
Important factors to include are premiums, coverage, waiting period and exclusions.
Yes, top-up plans are also add-on covers as they are used to supplement the coverage of your existing health insurance plan.
Yes, you can add a hospital cash add-on cover to pay for non-medical expenses during hospitalisation. This cover pays a daily cash allowance during a hospital stay that can be used to cover any non-medical expenses.
Zones are the classification of cities on the basis of the cost of living and medical treatments. The coverage is provided according to the zone you stay in.
There is no limit on the number of additional covers you can have. However, as per IRDAI regulations, the total premium of all add-ons cannot be more than 30% of your base policy’s premium.
An add-on cover is an additional benefit that is added to your existing health insurance plan on payment of an additional premium that enhances the coverage of your existing policy.
Yes, you can avail of tax benefits on the premium of add-on covers under section 80D of the Income Tax Act.
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