Unlimited Health Cover Gains Popularity: Is It Right For Everyone?

Unlimited sum insured refers to an insurance policy that provides sum insured with no pre-defined upper limit.  Many insurers in the industry are offering unlimited sum insured. Some insurers provide unlimited coverage up to Rs 1 or two crore, whereas some insurers provide unlimited coverage with clauses such as co-payment. “This type of insurance is typically considered ideal, as it does not have any limit on claims. In a time of need, it helps individuals receive the best medical treatment. One must be aware that insurance policies have certain exclusions, such as pre-existing conditions with a waiting period, intentional self-injury, and criminal acts, among others. It is essential to ask your insurer specifically about exclusions to understand the policy details, comprehend the coverages to make the most of your insurance policy,” says Amarnath Saxena, Chief Technology Officer (CTO), commercial, Bajaj Allianz General Insurance.

Do You Need Unlimited Health Insurance, Or Is It An Overkill? 

Unlimited health insurance is necessary for some people, where it is vital. Usually, these people are those with a significant pre-existing issue, a significant history of treatment in their family, or elderly dependents or parents with continuing medical conditions requiring regular hospitalisations. Unlimited cover is also useful for people who prefer high-value private hospitals or want to consider overseas treatment. So in these few examples, unlimited coverage provides peace of mind or coverage.

“However, for most younger families or healthy families, a capped base plan plus a top-up is enough. And more affordable without loss of coverage for large medical expenses. I do not think unlimited coverage is needed for most people unless you have a specific reason to believe you will incur very high treatment costs. Comparing your health requirements and seeing an advisor will help inform your decision,” says Saurabh Bansal, Founder, Finatwork Investment Advisor, a Sebi RIA (Registered Investment Advisor).

Agrees Amit Suri, CFP and Founder, AUM Wealth, “If you are someone who wants access to the best hospitals with no second thought and/or has parents with pre-existing medical conditions, then it may be a reasonable consideration. However, for an average healthy family, regular cover with a top-up cover is usually more than enough.”

What To Keep In Mind 

One needs to remember that the premium is a lot more expensive than regular plans. “Before making that premium payment, you may also want to consider the benefits of setting aside some funds for emergencies. Then, consider selecting a standard plan. Ultimately, it comes down to what works best for your needs,” says Suri.

However, there are certain things to keep in mind. “One should also consider that unlimited coverage policies may have certain exclusions or limits on specific treatments or services, with co-payments and deductibles, depending on the insurer.  Individuals with a lower risk tolerance may prefer the security of an unlimited cover policy, while those with a higher risk tolerance may opt for a combination of a base policy and a top-up plan,” says Saxena.