The exclusions part is extremely interesting as it tells you what is not covered

When Aurangabad-based Mandar Phadnis, 42, bought his health insurance policy three months ago, he did not suffer from any pre-existing disease (PED). Naturally, he believed no waiting period would apply in his case and just in case a medical problem cropped up one month after taking the policy, he would get a refund for the treatment. But that was not to be. “Once I bought the policy, I was informed that there is a third kind of waiting period for a specific set of medical conditions,” remembers Phadnis.

Most health insurance schemes have a waiting period for a few medical conditions such as cataract, hernia, hysterectomy (uterus removal), knee joint replacement, and hydrocele (accumulation of serious fluid in a body cavity, especially in men). Typically, these conditions are not covered for the first two policy years. This waiting period is applicable irrespective of the PED.

Waiting period irrespective of pre-existing disease:

Health covers apply a two-year waiting period for cataract, hernia, knee joint replacement, even if you do not have a pre-existing illness

Survival period clause for the critically ill:

Most critical illness covers insist a patient survives for at least 30 days after being diagnosed to file claim

Artificial life support not covered:

If an insured put on ventilator is unlikely to improve, health insurer do not pay the cost of ventilation

Expenses cover at health insurer’s discretion:

If a treatment could be done at a lower cost, insurer will pay the lower amount

Premium loading not as per  claim ratio:

Premiums are loaded by a minimum of 100 per cent on renewal 

Acts of God may or may not be covered:

Treatment for health issues or death due to a natural disaster may not always be covered

Suicides covered after 1 year:

Life insurers have seen a trend of suicide being committed in the second year of life insurance Says Mahavir Chopra, head of e-business at Medimanage.com, a health insurance consultancy firm: “This trend started a few years ago. And because these are daycare ailments, these are not detected on time and hence, medication is delayed.

Also, it is difficult to establish if these are related to PED or not. Hence, these ailments are not covered for the first two years.” Many complain about health insurers not honouring claims related to the above-mentioned ailments. These are among the conditions that health insurers use to save claim cost. Fifty-four-year old Pune resident Sukanya Sahay had a similar experience. She was shocked when her insurer wanted to wait for 30 days for her husband to survive before paying her claim under a critical illness plan. Critical illness covers are fixed benefit plans. One gets the full sum insured, irrespective of whether one is hospitalised or not, or what the treatment expenses are.

However, most plans have a “survival period” clause, saying the insured must survive for at least 30 days after being diagnosed with any critical illness to file the claim. A few insurers even have a 90-day survival period. “Whether one survives or not, a cost has been incurred. Shouldn’t insurance companies pay that? At the same time, these policies pay even if you aren’t hospitalised, in case of a critical illness,” says Sahay. A similar clause is that if an insured is put on ventilator and his health condition is unlikely to improve, then his health insurer will not pay the cost of ventilation, says Chopra. Max Bupa Health Insurance’s policy document say, “Artificial life maintenance, including life support machine use, where such treatment will not result in recovery or restoration of the previous state of health.” Cost of using a ventilator is around Rs 20,000 a day.

Many insurance policies state that only reasonable and necessary expenses will be eligible for a claim. For example, if your hospital charged you Rs 1 lakh for a service which could have been done in, say, Rs 50,000, then the insurer will reimburse the lower amount. Insurers link it to expensive room / high-end hospital, as costs of hospitalisation is mostly linked to the room rent. Most policies say that premiums will increase if you make a claim. But, the loading may not be proportional to your claim. According to a recent proposal by the Insurance Regulatory and Development Authority (Irda), companies will be able to impose the pre-determined loading only if your claims in three consecutive years (except the previous one) exceed 500 per cent of the premium.

Then there is the “acts of God” category — events that are beyond human control such as floods. According to life insurers, they have noticed a trend of suicides being committed in the second year of life insurance. That is because “death due to suicide” is covered from the second policy year under a life insurance plan. Lastly, if an insured has gone missing or died and the body has not been recovered, the dependents can claim against his / her life insurance policy, but only after five or seven years, depending on the insurer.

“This is ridiculous. How can you prove five years later that a person is no more, something you can’t do today? And if one needs money, one has to wait for five years,” says the broker. Insurers reason that if the body has not been recovered for such a long time, then you can be sure the person has died. On a bad day, you can land in a soup due to these small, but significant, clauses. It pays to know the facts.