Buying Health Insurance? Know why Arogya Sanjeevani Policy could be ideal for you.

Arogya Sanjeevani is designed to provide adequate health cover at a reasonable premium. Read on to find out if it works for your particular needs as well.

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Buying a health insurance plan can seem like a daunting task. The sheer number of available options with multiple variations in coverage and stipulations can be overwhelming for some.

To address this, the Insurance Regulatory and Development Authority (IRDAI) has asked all general and health Insurance providers to introduce a basic, standard, and uniform health indemnity insurance product called Arogya Sanjeevani Policy.

Through this article, we would help you decide if you should opt for this policy. But first, let us look at how to determine your health insurance needs.

How to determine your health insurance needs?

Let us start with a rule of thumb: Your health cover should be at least 50% of your annual income.

Remember, that this rule of thumb only creates a floor for the coverage needed. Your actual needs may be much higher than this and can only be determined based on an honest appraisal of your health.

That said, anything lower is likely to be grossly inadequate, and may leave you high and dry in your time of need.

Equally important is to ensure that you expand the coverage you have with time.

A 2018 study conducted by Mercer Marsh Benefits found that the medical trend rate in India is twice the average inflation rate of the economy. This means the medical expenses per capita are rising at double the rate of the typical basket of goods and services you use.

The report also noted that the out-patient expenses were experiencing a much steeper increase than hospitalization expenses. The incidence of non-communicable diseases like heart disease, stroke, cancers, diabetes, etc. is also resulting in higher healthcare expenses.

Therefore, when determining how much health cover you need – make sure you are being honest about your health condition. Start by making a list of your medical history. Understand that your lifestyle could also make you more susceptible to certain medical conditions and consider your parents’ medical history as well.

The amount of insurance you need also depends on your place of residence. If you live in a metro or tier 1 city, you should opt for a higher sum insured compared to someone living in a tier 2/3 city or in a rural area.

Individual cover vs. family floater

Sum Insured is not the only variable that determines the extent of the coverage offered.

You would also have to choose among:

  1. Individual cover: This type of cover is for an individual – either self or someone else in your family whom you wish to insure.
  2. Family non-floater: This type of policy provides protection for the entire family, with everyone having a separate sum insured.
  3. Family floater: This type of policy provides cover for the entire family, with a single sum insured shared among all.

Individual cover is ideal for people getting their first jobs, bachelors, and the elderly.

Family non-floater is best suited for families where parents / parents in laws also need to be covered and it may be better to have separate sum insured for each member.

Family floater is ideal for young couples with children / families where the bread winner is under the age of 50 years. A shared sum insured works when the probability that more than one family member would need to claim the insurance is low.

Once you have determined your health insurance needs, the next step is to compare it with what the policy offers.

What does Arogya Sanjeevani offer?

The sum insured available under Arogya Sanjeevani Policy varies between Rs. 1 lakh to Rs. 5 lakh in multiples of Rs 50,000.

The policy also has a 5% co-payment clause. In other words, on any claim you make you will have to bear 5% of the admissible claim amount out of your pocket. This allows the premium charged to be lower than it would be otherwise.

Further, Arogya Sanjeevani Policy also rewards you with a 5% cumulative bonus for every claim free year. In other words, if you do not make a claim in the current year, your sum insured will be increased by 5% at the time of renewal for the next year, subject to a maximum of 50% of the initial sum insured.

The product also offers following coverages -

  1. Cover for hospitalization expenses arising from hospitalization for at least 24 hours.
  2. Pre-hospitalization expenses for a period of 30 days prior to the admission date, and post-hospitalization expenses for a period of 60 days from the date of discharge are also covered.
  3. Cover is also provided for alternative treatments done as an inpatient in AYUSH hospitals.
  4. Daycare procedures like cataract, etc. are also covered.
  5. Any dental or cosmetic surgery expense that arises due to a disease or injury is covered as well.
  6. Expense for road ambulance is cover up Rs. 2000 per hospitalization.
  7. Twelve modern treatments including balloon sinuplasty, immunotherapy and stem cell therapy are covered up to 50% of Sum Insured.

It is important to remember that Arogya Sanjeevani Policy has an initial waiting period of 30 days from the coverage start date. In other words, for the first 30 days you will receive cover only for medical expenses that arise out of an accident.

Further, a 48-month waiting period is applicable to pre-existing illnesses. Specified surgeries and treatments mentioned in the policy terms and conditions also have an associated 24 months and 48 months waiting period.

Is Arogya Sanjeevani Policy right for you?

Arogya Sanjeevani policy is ideal for first-time insurance buyers. If you wish to get some financial protection without having to deep-dive into the nuances of health insurance, this could be a great choice for you.

Here are a few reasons you should opt for the policy:

  1. You have just entered the workforce and are looking to get your first health insurance cover
  2. You have a good corporate cover, and are looking for additional coverage to meet your health insurance needs
  3. You are in prime of your health, and waiting periods associated with pre-existing conditions is not a concern
  4. You want coverage for AYUSH treatments as well
  5. You are comfortable with a 5% co-pay on your health claims

Arogya Sanjeevani is an entry-level health insurance policy designed to provide adequate health cover at a reasonable premium. Nevertheless, make sure you make an honest assessment of your health needs before purchasing a health insurance plan.

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