Health Insurance policies are offered by different insurers with varied features and benefits. Also, the health plans of the insurers differ in terms of cost of the premium, deductibles, co-payments, etc. It may not be able to cater to the specific health insurance needs of an individual. To address this issue, insurers offer Health Insurance Riders which are amendments to the terms or coverage of your health policy.
What are Health Insurance Riders?
Riders are amendments made to your basic health insurance policy to include specific additional benefits at a cost. Riders cannot be bought individually and have to be bought as an extension to the base health policy.
For example, if your health insurance policy has a limit on the room rent, then you can opt for a Room rent waiver rider which will waive off the cap on the room rent.
Below are the top 5 health insurance riders:
- Hospital Cash
In this, you can avail of a daily cash allowance for the total number of days you were hospitalized. The allowance amount and the number of days for which it can be claimed will be mentioned in the rider.
The purpose of this rider is to compensate for the loss of income due to hospitalization.
2. Critical Illness
In this, your insurer will pay you a lump sum if you are diagnosed with any of the critical illnesses mentioned in the policy. The list of critical illnesses usually includes heart attack, kidney failure, cancer, etc.
The lump sum is given irrespective of the total expense incurred for the treatment. Once the lump sum is paid out, the Sum Insured for that year will be reduced correspondingly.
For example: if you have a health insurance plan with a Sum Insured of Rs.5 lakhs and you have taken this rider for a lump sum of Rs.2 lakhs, then on the diagnosis of any critical illness Rs.2 lakhs will be paid to you. However, the Sum Insured for that year will be reduced to Rs.3 lakhs.
3. Room Rent Waiver
Most health insurance plans have a maximum limit specified on room rent. It can be capped at a fixed amount or specified as a percentage of the Sum Insured.
This rider will waive off the limit on the room rent and allow you to opt for hospital rooms that are at a higher grade than that specified by your health policy.
Example: If you have a health plan with Rs.5 lakhs as Sum Insured and the room rent is capped at 1% of the Sum Insured per day, then you can opt for hospital room charges less than or equal to Rs.5000/-.
However, if you have taken the Room Rent waiver rider, you can opt for any room irrespective of the rent.
In many hospitals, the treatment costs, consultation charges, surgery costs, etc., are dependent on the category of the hospital room you have chosen. So, if you opt for a higher category room with a room rent waiver, then there is a possibility of an increase in the cost of hospitalization.
4. Maternity Cover
This rider covers the maternity expenses incurred during childbirth. However, most health plans offer this cover after a waiting period of 24 – 60 months.
The clauses for this cover vary depending on the health insurer. Some insurers cover only delivery expenses but not pre-and post-delivery expenses. Some insurers do not cover the newborn baby expenses.
5. Personal Accident
In this, the insurer will pay you a lump sum if you are disabled due to an accident. The amount of compensation paid is dependent on the severity of the injury and the extent of disability.
In case of permanent disability such as loss of both limbs, loss of eye, etc., usually the full compensation is paid. In case of partial disability such as loss of one limb or one eye, an amount decided by your insurer will be paid.
Advantages of Health Insurance Riders
- Helps you to avail additional benefits within your health insurance plan at a low cost.
Disadvantages of Health Insurance Riders
- Any claims made on the rider may reduce the Sum Insured for that year.
- Some riders like maternity cover come with a waiting period.