THE WHOLE TRUTH: Most health policies do not cover your entire medical costs

Diabetic patients, it seems, have cause for rejoicing. Insurance companies are now offering health policies for the disease — something that was unheard of even a few months ago. In fact, ICICI Prudential claims to have introduced the country’s first health insurance for diabetes. For diabetic patients like Ranu Mitra, a housewife from Behala who is contemplating taking one, it seems like a godsend. “I hope that this policy will help me to recover my treatment costs,” she says.

Mitra’s joy is understandable since she has to undergo treatment several times a year. But does the policy cover all the costs of treatment that may be required? “The present policy provides cover only when the critical illness occurs for the first time. It also includes regular testing (HbA1c, blood pressure and pulse rate check) every fourth and eighth month during the policy term,” says a senior official at ICICI Prudential. The policy sum options are of Rs 3 lakh, Rs 5 lakh and Rs 10 lakh and the yearly premium ranges from Rs 11,250 for those in the age group of 35–40 years to Rs 23,900 for those in the age group of 55-60 years.

“But the snag is that one is given 50 per cent of the sum assured after six months and 100 per cent of the sum assured after one year and thus there is a period of six months when a patient is left financially insecure,” says Soma Dutta, assistant secretary of Consumer Unity and Guidance Forum in Calcutta.

Furthermore, Dutta says that the policy does not cover Type 1 (juvenile) diabetes and does not pay for dialysis either which can cost as much as Rs 10,000. “The insurance company’s empanelled doctors might give a one-sided view of whether or not a particular medical advice has been strictly followed to repudiate a claim,” she adds. Sunil More, manager of priority circle at ICICI Prudential, Mumbai, acknowledges that dialysis being left out is a cause for concern. “We hope to address issues like dialysis in the future. We have started off with Type 2 diabetes (diabetes due to defective responsiveness to insulin) and that is a significant first step,” he says.

The concerns in the case of health policies for diabetes apply to other diseases as well. “Tata AIG’s Health First scheme caters to 12 critical illnesses that cover heart attack, heart transplant and heart valve surgery,” says Sujata Dutta, vice-president of accidents and health, Tata AIG. But here again, conditions apply. For this benefit to be payable, the insured person needs to survive for a period of at least 30 days after the operation/critical illness. There is a waiting period of 180 days following the issue date or commencement date or reinstatement date of the policy and claims can be paid only once for the same critical illness. “So what happens if a patient does not survive for 30 days,” asks consumer activist Prabir Basu, a member of the state Consumer Protection Council.

Again, take the insurance policies for the aged introduced by the National Insurance Company. R.R. Hati, deputy manager of National Insurance Company, elaborates on the exclusion clauses laid out in the Varistha Mediclaim for senior citizens, that is, those above 60 years. “Under this scheme the company shall not be liable to make any payment for pre-existing diseases when the cover begins for the first time. However, these diseases will be covered after one claim-free year under this policy.” Under this scheme, only two pre-existing diseases — diabetes and hypertension — will be covered from the inception of the policy, provided the company receives additional premiums for covering these pre-existing diseases.

Senior officials at National Insurance Company say that this provision has been made since people have a tendency to conceal diseases that could give rise to other ailments. The undisclosed amount of additional premium is a big cause for worry, according to Soma Dutta.

The consumer should also keep in mind other details. Additional benefits offered by some insurance companies for critical illnesses cannot be taken on their own — they are additional benefits that are offered along with specific policies. Explains Jaydeep Banerjee, section head of Birla Sunlife Insurance, “We do offer riders for critical illnesses but the claims for these riders are given at one go and they cannot be renewed. Once a particular disease is detected, the total amount is paid for the sum assured and the validity of the rider ends there.”

However, some insurance policies do offer assistance despite the exclusions. Senior officials of National Insurance reveal that they are capping the limits of treatment costs in hospitals so that there is no overcharging that could adversely affect the consumer. Again, Tata AIG offers a health policy named Health where the premium does not increase every year. “Premiums increase every five years on renewal,” explains Sujata Dutta of Tata AIG.

“Insurance policies can help people but one would be advised to have a proper understanding of what one is paying for to receive the stated benefits so as not to be left in the lurch,” says consumer activist Soma Dutta.