The comprehensive health insurance plans from health insurers are mostly indemnity covers that make good the losses only up to the medical expenses actually incurred subject to the maximum sum insured in the policy. However, in the fixed benefit plan you get the full sum insured when hospitalised
If you are willing to have a fixed benefit health plan, the new product from Kotak Life Insurance – Kotak Health Shield – deserves attention. The product will cover you against four critical illnesses — Cancer, Cardiac, Liver, Neuro — under the same policy. One can also add financial protection against Personal Accident — accidental death or disability.
“No insurer in the life insurance segment covers liver and neurological ailments, although standalone cancer and cardiac products are available. This is what differentiates our product. We are the first life insurer to launch a comprehensive health insurance plan, covering most critical illnesses under a single product. We have added accidental death and disability too, which is available only as a rider with other insurers,” says Suresh Agarwal, Chief Distribution Officer, Kotak Life Insurance.
While buying the policy, the customer will have discretion to choose one or more of the five options available under this plan, but Personal Accident cover cannot be taken standalone. The more options you choose, the higher will be the premium. There will be a 5 per cent discount on the premium for women and 5 per cent discount on year one premium for existing policyholders of Kotak Life Insurance.
Additionally, the policy offers several other benefits such as daily hospitalisation cash benefit, waiver of premium on being diagnosed with minor conditions, and income benefit on being diagnosed with major conditions. These benefits will come at extra premium. The premium payment term and policy period for the Kotak Health Shield will be minimum five years and maximum 40 years.
Total sum insured under various options
The life assured will have the flexibility to allocate the sum assured under the opted options as per his/ her requirement. The total sum insured in the policy can go up to Rs 1 crore (minimum Rs 10 lakh and maximum Rs 50 lakh per option) if you buy more than two covers. Additionally, the customer may also add Rs 50 lakh under Personal Accident Shield.
“Although the product is a fixed benefit cover, the sum insured to be paid will depend on the stage of the ailment the customer is. For minor conditions, 100 per cent of the sum insured will not be paid. The sum insured payment will vary in the range of 25 to 100 per cent,” says Agarwal.
For example, in case of accidental death under Personal Accident Shield, 100 per cent of the chosen sum insured will be paid. However, in case of disability, Accidental Partial Permanent Disability will trigger only 50 per cent of the sum insured, but 100 per cent in case of Total and Permanent Disability.
Similarly, there are sub-limits against the Sum Insured in other Options as well. For example, in Cardiac Shield, 25 per cent of the sum insured will be given in case of minor conditions, and 100 per cent in case of major conditions. Look into those sub-limits before buying the policy.
“With daily hospitalisation cash benefit, waiving off the premium for people with minor conditions and providing cover for most critical illnesses like Cancer, Cardiac, Liver and Neuro, the plan will address the insurance needs for most Indian consumers across the country. The product has been designed keeping in mind the safety for the entire family against adversities, it also has an aspect of giving benefit to people on loss of job,” says Indraneel Chatterjee, Co-founder and Principal Officer, Renewbuy.com.
“This plan is expected to witness good response from consumers, specially from millennials. The company should however look at tapping Tier 2, Tier 3 cities and smaller towns (along with the metropolitan cities), as people in semi urban India today are equally aware of the importance of health insurance,” Chatterjee adds.
The plan also provides tax benefits on premium paid under Section 80 (D) of Income Tax Act, 1961.
Should you take it if you already have a health plan?
The comprehensive health insurance plans from health insurers are mostly indemnity covers that make good the losses only up to the medical expenses actually incurred subject to the maximum sum insured in the policy. However, in the fixed benefit plan you get the full sum insured when hospitalised. So, while fixed benefit cover may appear attractive, these are not as comprehensive as the indemnity covers. Both the types have their own benefits. Kotak Health Shield can complement your existing health policy, but cannot replace it.
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