What Is a Top-up Health Insurance Plan?


Are you worried that your mediclaim insurance cover might not be enough? Fret not, because a top-up health insurance plan may be the perfect solution to your concerns. Top-up insurance plans are those that come into the picture once the cover of the primary insurance policy is exhausted. To speak in plain terms, they act as the spare wheel in the trunk of your car in times of need. This gives you an additional layer of medical protection without going through the hassles of having to buy a fresh health insurance plan each time you need one. You could opt for a top-up cover when it is almost certain that the hospitalization expenses may exceed the sum insured.

You just need to provide some basic details to know your eligibility for an additional top-up cover. However, deductibles are something that you need to keep in mind while buying them. Deductibles are those elements that a policyholder has to bear before such top-up cover kicks in. These deductibles make top-up plans dearer or cheaper depending on their quantum. However, since top-ups are considered as an additional cover, most insurers do not conduct a health checkup for people aged less than 55 to give the policy.

Let us understand top-up health insurance with an example.

Suppose that your existing insurance policy covers your expenses till a sum assured of Rs5 lakh. Now that you’ve decided to increase your cover considering soaring healthcare prices, you decide to either opt for a fresh health insurance plan for Rs5 lakh or just simply increase your previous cover with a top-up policy of the same amount. However, you should remember that the premium for a fresh policy would be around twice the price of a top-up cover; this makes a top-up cover more economical.

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Moreover, top-up health insurance plans come with a threshold clause, i.e. you can only avail the benefits of the top-up plan once you have crossed this threshold. For instance, suppose a top-up insurance plan offers a sum assured of Rs3 lakh and a threshold limit of Rs2 lakh. This means that you will not be able to avail the benefits of the top-up plan until you incur hospitalization charges of Rs2 lakh, either through the insurer or your pockets. Hence, it is important that you select a plan that does not have a high threshold limit.

In a nutshell, these top-up plans are just like any ordinary health insurance plan with a deductible factor attached to them.

When you decide to get a top-up plan for yourself and your beloved ones, you should look for one that complements your existing medical policy. One key point you should remember is that a single policy can only provide you with so much protection, but a top-up plan along with a basic plan would help you get the cover of two under a blanket policy with extended benefits.