Everything About Indemnity Health Insurance Plans in India

Did you know that nearly every Indian feels burdened by high medical expenses? Plus, out-of-pocket medical expenses in India are still at 50%. That is where indemnity health insurance plans come to the rescue. These plans let you choose your hospital, pay for actual medical bills, and get reimbursed later.

In this blog, we will simplify everything you need to know about indemnity health insurance plans in India and why they are a must-have for financial protection.

What is an Indemnity Plan?

Let us take the case of Mr Singhania. He has an indemnity health plan, which gives him a ₹5 lakh coverage. His spouse gets hospitalised for heart surgery, for which the total bill is ₹3 lakh.

What does he do? In short, nothing. His insurance company settles the bill, and he can use the remaining ₹2 lakh for other medical expenses.

This is exactly what an indemnity plan does. In this, your insurer bears the full cost of your medical expenses up to the sum insured. In fact, it is the most common type of health insurance policy in India.

Why Buy an Indemnity Health Insurance Plan?

Flexibility to Choose Healthcare Provider

Perhaps a minor inconvenience that regular health insurance plans have is being restricted to network hospitals only. This reduces your options and may cause problems during an emergency.

However, with medical indemnity insurance, you can avail reimbursement benefits at any hospital across India. That means, when an emergency strikes, you can avail your benefits anywhere in the country and ensure the safety of your loved ones.

Offers a Wide Range of Coverage

Indemnity health insurance offers a wide range of coverage for various diseases. This means, if a disease strikes, you do not have to worry whether your insurance will cover it or not.

You can have peace of mind knowing that hospitalisation expenses related to that disease will be paid. Room rent, ICU charges, surgical fees, ambulance costs and other related costs will be taken care of by your insurance provider.

Unlimited Claim

Indemnity health insurance plans have one of the most beneficial advantages of unlimited claims. With this, you can make as many claims as you want within your policy period. There is no restriction on the number of claims you can make.

However, you have to make sure that your claims remain within your sum-insured amount. If your hospital bills exceed that amount, you have to pay the difference from your own pocket.

Lower Premiums

Premiums are a vital deciding point when buying any health insurance policy. Indemnity-based health insurance plans are one of the cheapest options in India. For example, if you buy the My Health Care Plan from Bajaj General Insurance, your premiums could start at ₹7,500/year if you apply for the plan in your 20s!

With this, you can get coverage of ₹5 lakh for the policy period of 1 year to 3 years. Please note that this amount is subject to change according to various factors affecting premiums.

Ease of Usage

Lastly, indemnity health insurance is easier to manage and handle than other policies. You do not have to think about network hospitals, high premiums, and the capping on the number of claims.

It not only helps you have peace of mind but also ensures that your finances are safe and secure when an emergency strikes.

Indemnity vs Fixed Insurance: Differences Explained

Now that we know the benefits of indemnity health insurance plans, let us see how it differs from fixed health insurance:

How do Indemnity Plans Work?

Now that we know the benefits of a medical indemnity plan and how it differs from fixed health insurance, let us see how it works in real life.

Mr Sharma has an indemnity health plan with a sum insured of ₹10 lakh. However, he also has a ₹50,000 deductible in his policy. He finds himself in a medical emergency and goes to his nearest hospital. However, the hospital was not part of the insurer’s network.

He accumulates a bill of ₹4 lakh, which he pays for himself. Then he submits the medical bills to his insurance company for the reimbursement claim process. Upon confirming, the insurance company pays him ₹3.5 lakh (₹50,000 deductible), and he can use the remaining ₹6.5 lakh for future claims.

Things to Remember Before Buying Medical Indemnity Insurance

Buying a medical indemnity plan seems exciting and rewarding. However, keep these things in mind before doing so:

Claim Settlement Ratio

Always check the claim settlement ratio or CSR of an insurance company before purchasing any policy. It indicates how many claims they actually settle versus how many they receive.

The higher the ratio, the better it is for you. For example, Bajaj General Insurance has a 95.99% CSR, showcasing that we take care of our policyholders when necessary.

Inclusions and Exclusions

The next step is to check what is included and excluded in your indemnity health plan. To do this, thoroughly check the policy documents and brochure.

Knowing the inclusions and exclusions helps you avoid unwanted surprises and prepares you in times of need.

Deductibles and Co-Payments

Deductibles and co-payments are important when it comes to buying an indemnity plan. These decide how much out-of-pocket expense you have to bear.

Always choose a plan with minimal or no deductibles. This will ensure that you save your finances while the insurance company pays for your hospital expenses.

Network Hospitals

Although indemnity plans allow claims outside of their network hospitals, choosing an insurer with a wide network of hospitals increases your chance of getting cashless claims.

For example, Bajaj General Insurance has a network of 18,400+ hospitals across India to help you get the care you need anywhere. Just check your nearest hospital on our website or app, Caringly Yours and avail the cashless claim benefit.

Insurer Reputation

Lastly, research your preferred insurance company thoroughly. You can do this through various online forums. Check what customers are saying about the company.

Inquire about their customer service, check app ratings and Google My Business. Always go with an insurer with a rating of 4 stars or more.

Final Thoughts

Indemnity health insurance plans give you control, flexibility, and peace of mind during medical emergencies. By covering your actual hospitalisation costs, they ensure you get the care you need without worrying about expenses.

Whether for individuals or families, choosing the right indemnity plan can make a world of difference. Stay informed, stay protected, and let your insurance work for you when it matters most.

FAQs

How much does a medical indemnity plan cost?

Medical indemnity plan costs can vary according to different factors such as your age, pre-existing disease, and sum insured amount. However, in general, the cost can range between ₹6,000 to ₹17,000 (approx.).

What does an indemnity health insurance cover?

Indemnity health insurance covers hospitalisation costs. These could include ICU charges, room rent, surgery cost, medicine cost, daycare treatments, etc. The plan could also cover pre and post-hospitalisation costs. However, it depends on the insurer.

Who needs indemnity insurance?

Everyone should invest in indemnity health insurance as it is the most common one in India. However, there is a professional indemnity insurance which is ideal for doctors, lawyers, accountants, and engineers.

Which company gives the best indemnity health insurance plans?

Bajaj General Insurance provides the best indemnity insurance in India. They provide various plans which cover the needs of the policyholders and come with attractive sum insured options.

What are the exclusions in an indemnity plan?

Exclusions depend on the type of policy and the policyholder's profile. However, in general, indemnity health insurance does not cover cosmetic surgeries, liposuction or surgical weight reduction, circumcision, and other non-medical items.

**Standard T&C apply

Disclaimer: Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.

Disclaimer: The content on this page is generic and shared only for informational and explanatory purposes. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making any related decisions.