Last Updated: Jan 07, 2022, 10:24 AM IST

When it comes to senior citizens above the age of 60 the health insurance options have increased over the past few years. However, there is always a trade-off between premium affordability and benefits. Here's how you can pick the right health insurance plan best suited for your needs.

HEALTH INSURANCE OPTIONS FOR SENIORS HAVE INCREASED

While there was a time when hardly any insurer wanted to offer health coverage to senior citizens, the situation has changed now. "A few years ago, it was almost impossible to think of buying a health insurance policy, once the person touched 60; however, the insurance landscape has changed over time. Senior citizens can avail coverage in the older ages to take care of the rising cost of medical treatments, which is most common during older age," says Indraneel Chatterjee, Co-founder, RenewBuy, an insurance broking firm.

YOU CAN GET A HEALTH COVER DESPITE COMORBIDITIES

Often an existing ailment was reason enough for health insurers to reject a new policy application of customers. When it comes to people aged above 60, a large part of this segment suffers some or the other kind of ailment. This was the reason why insurers in the past were reluctant to offer health insurance to this segment. However, things have changed. "Insurers are increasingly more sophisticated in catering to such chronic ailments. Generally, if you have moderate health issues that are well managed the insurer will issue you insurance," says Kapil Mehta, Co-founder of SecureNow Insurance Broker.

Common comorbidities like diabetes or high blood pressure are covered by a good number of senior citizen special polices. "There are insurance companies that permit health insurance for people above 65 years with comorbidities like diabetes and BP. While they may have to pay loading charges or bear a waiting period for some duration to get their pre-existing diseases covered," says Naval Goel, Founder & CEO, PolicyX.com, an insurance comparison portal.

Watch out for these limiting factors

While insurers have started offering health plans to senior citizens, however, there are a lot of limitations. "Most of these plans have certain common features in terms of the benefits provided. Some exceptions in the case of health insurance for senior citizens include capping on the sum assured, longer waiting period and pre-existing clauses," says Chatterjee.

One of the shortcomings of many of these plans is the disease-wise waiting periods. "Regular Mediclaim insurances tend to have just one waiting period for pre-existing conditions whereas senior plans would often list out waiting periods by disease. These higher restrictions make it easier to issue insurance to seniors with medical issues," says Mehta. Similarly, many plans also have disease-wise sublimits which means they will not cover if the expenses go beyond these sublimits for any specific disease.

STANDARD PLAN WITH HIGHER ENTRY AGE OR A SENIOR SPECIAL PLAN?

There are many new standard plans that have started offering higher entry age so that senior citizens can also buy these policies. Given the two choices, how should a senior citizen decide which plan will work better?

When senior special policy scores: Being customized to old age requirements, senior special plans tend to tick more right boxes for senior citizens. "The basic coverage under senior citizen plans includes pre and post-hospitalization costs, ambulance charges, ICU charges, surgeon's fees etc. There are also senior citizen plans which cover organ donation and transplantation expenses," advises Chatterjee.

The choice will mainly depend upon how much health insurance you already have. If you depended primarily on your corporate plan and did not buy an individual plan, then a senior special plan can be a better option. "In case a senior citizen has not applied for a health insurance policy after 60, it is suggested that they opt for senior citizen-based plans. This is because a lot of benefits in the senior citizen health insurance plan pertain to their age. Also, senior citizens can keep renewing the policies till ripe old age, which is not the case in comprehensive health plans," says Chatterjee.

If you already have or have a higher risk of developing a chronic ailment then also having a senior special plan would be a better choice, "There are several pure senior citizen insurances available, and their main value proposition is to cater to seniors that have chronic ailments. The underwriting, pricing and benefits are oriented towards such seniors," says Mehta.

When standard policy can work: There are many standard policies that have higher entry age and offer long-term coverage which may be a good option for senior citizens. "Over the past 2 to 3 years insurers have moved towards regular products where entry age can be over 65 years. Fewer plans are administratively easier for insurers to handle," says Mehta.

Standard plans offer wide coverage at a relatively higher premium. "Primarily, standard health insurance plans come with features and benefits. And there is no co-payment in standard health insurance plans. If there are a few plans with co-payment, the payment remains very marginal in standard health insurance plans up to 20%" says Goel.

WHETHER TO GO FOR CO-PAYMENT OR NOT?

Most of the senior special plans offer lower premiums in comparison to standard plans but it comes with a trade-off. "In senior citizen plans, the premium is lower than standard health insurance but there is a co-payment option in these plans along with fixed sum insured as the sum insured is given under limits in senior citizen plans," says Goel. Each time you make a claim you will have to pay a part of it as agreed under the copayment clause. Some plans give you the option to pay a higher premium to have no copayment obligation.

So how should one decide if one should opt for a plan with co-payment? "It entirely depends on the financial capabilities of the policyholder. The health insurance with no co-payment charges a little higher than co-payments. If the premium doesn't come quite heavy on the pocket of the policyholder then they must take it without co-payment as paying a higher premium is always cheaper than paying a hefty hospital bill," says Goel.

There are also conditions in which the insurer will only issue a policy if you agree to co-payment, especially in cases of pre-existing diseases. "A co-pay is good to opt for if you suffer from chronic ailments. Insurers are more willing to issue insurance if they know that you will pay a part of a possible hospital bill. The co-pay aligns the insurer and your interest completely. For example, you would also like to reduce your hospital stay to a minimum if you have a co-pay because you pay part of the bill. Had there been no co-pay you have less incentive to get discharged earlier," says Mehta.

So if you do not have any chronic ailment going for a plan without copayment may be a better option. "If you are in good health then it's better to opt for a plan without co-pay for the obvious reason that the complete hospital bill will be paid for by the insurer. Do keep in mind that even when there is no co-pay there are some items such as administrative charges and toiletries that the insurer will not cover. These costs can be between 10 to 15% of the total bill" says Mehta.

If affordability is an issue, then it is better to have a plan with copayment than not having a plan at all. "There is another reason why you might opt for a co-pay and that is to keep the premium low. Co-pay plans are cheaper. Some insurances offer you the option of paying a higher premium later and removing the co-pay. This is useful because you can buy an affordable plan now and later when you can afford to pay more, remove the co-pay," says Mehta.