The importance of having adequate health insurance cannot be overstated. While it is recommended that one has a single policy with the required coverage, sometimes, it may make sense to have multiple policies also.
Having multiple policies will allow you to customise your coverage, choosing specific policies for unique needs, such as critical illness, maternity, or outpatient care
The importance of having adequate health insurance cannot be overstated. While it is recommended that one has a single policy with the required coverage, sometimes, it may make sense to have multiple policies also.
When Having More Than One Policy Makes Sense
Having more than one health insurance policy can help in enhancing the total coverage. Suppose, one policy has a cap on certain treatments or on room rents, a second policy might help bridge the gap.
Let us say you have one policy with a cover of Rs 5 lakh and another policy with a cover of Rs 10 lakh. If your total bill is Rs 12 lakh, you may claim Rs 5 lakh from the first one and Rs 7 lakh from the other.
Says Pankaj Nawani, CEO, CarePal Secure, “Holding multiple policies allows you to customise your coverage, choosing specific policies for unique needs, such as critical illness, maternity, or outpatient care.”
So, you can choose to have a general insurance cover and a specific cover for critical illness.
One may also opt for a deductible to reduce policy premiums. In such a case, a certain amount needs to be paid from one’s own pocket, while any amount beyond that is paid by the insurance company. If you have a policy with a deductible of Rs 5 lakh, you can buy a policy with a cover of Rs 5 lakh to cover the cost of another policy.
“Also, having multiple insurance policies work well when you have both corporate and your floater policy, as additional payment can be claimed from your retail policy,” says Sundaram Venkatavaradan, secretary, Insurance Brokers Association of India (IBAI).
Challenges You May Face
However, coordinating claims between multiple insurers can be a complex affair. Documentation requirements and timelines of different insurers may be different and this can mean delays if not managed in an efficient manner.
Also, sometimes if the coverage overlaps, there might be a dispute over which insurer is liable. This can lead to a delay or even partial settlement of claims.
Also, most insurers have a contribution clause. It means that claims are shared proportionately. One needs to understand and apply the clause correctly. Also, having multiple policies would mean higher premiums and the high cost might set off the benefits, if not planned properly.
Best Practices In Claiming From Multiple Policies
First, understand the policies in detail and the terms and conditions, especially the contribution clause and the extent of coverage offered. Next, maintain documentation and create multiple copies of various documents. As soon as an event occurs, notify multiple insurers without delay. If all of this proves too overwhelming, consult a financial advisor for help.