How can checking Sub-Limits and Exclusion in a Health Insurance help You?

The insurance company makes it easier for the customer to understand the policy most of the time. There may be no confusion after the insurance has been obtained and the customer applies for the claim. Nevertheless, a customer might always ask relevant questions related to the policy to have transparency between both parties. Ceratin factors in insurance require a customer to pay extra heed. Those are the essential ones while receiving reimbursement or claim during the time of crisis.

Different Insurance policy has different rules and guidelines which a customer needs to understand. Similarly, while buying a health insurance plan, it is necessary to read about the guidelines that specifically mention what is excluded from the claim coverage and the mentioned sub-limits in the policy. These sub-limits and Exclusion help customers understand their limit on room rent, doctor visits, hospital expenses, etc.

The team of insurance experts from Secure Cover would further explain in this blog the necessity of checking any or all exclusions and sub-limits in a health insurance plan. The students going abroad to pursue their higher education in countries like the US must check on these exclusions and sub-limits in their student health insurance plans. It needs to be done before they purchase the plan to enroll in their universities abroad and begin traveling.

Various kinds of Exclusion

Having health insurance is essential for every individual traveling abroad or residing in their home country. It ensures the safety of their travel and their safety of health during any medical crisis. However, assuming that one would receive coverage for every minor or major health crisis might not be the right thing to do.

A health insurance plan that covers you for any accidental damage to your physical body might not do so if you already suffer from a condition and encounter an accident. Hence, the insurer has Exclusion and sub-limit as part of their insurance policy to protect their interests.

An exclusion’s nature could be mainly of 4 kinds – Categorical Exclusion, Permanent Exclusion, Conditional Exclusion, and Time-based Exclusion.

Categorical Exclusion

The categorical Exclusion refers to that kind of Exclusion wherein the insurance company only compensates for the eventualities that do not fall under the purview of the plan. For instance, despite being a sub-set of health insurance, dental or vision insurance would not cover illnesses related to kidney or liver. This exclusion category is somewhat similar to property insurance which does not compensate the insured for the theft of a vehicle. It falls under a different category of insurance, i.e., motor insurance.

Permanent Exclusion

These are those exclusion categories wherein an insurance provider would not cover, irrespective of the nature of the eventuality. For example, a health insurance plan that does not have a provision for compensating for the death caused due to suicide would not compensate the nominee if the death is proved to be a suicide committed by the insured.

Time-Based Exclusion

Time-based exclusions are the ones that remain as a limit for a certain period ranging from 90 days-2 years depending on the company policy. These exclusions could be for liver or kidney disease. The insured does not use a normal health plan to get free treatment for existing disease or condition.

Note: In the US, Secure Cover health insurance plans, such as SC Elite and SC Plus, for international students are ACA comparable. Hence, they provide Cover against pre-existing diseases as well.*

Conditional Exclusion

The eventualities that are not typically covered in an insurance plan comes under conditional Exclusion. For example, any general health insurance provider does typically not cover treatment for an eye or tooth. However, if an accident causes injury to these two body parts, the insurance provider would undertake it as coverage in the health plan.

Similarly, diseases that are not usually covered by the plan also get covered in a medical emergency.

Sub-limits

While exclusions exclude the benefit that an insured person may receive on a particular eventuality, sub-limits put a cap/limit on the extent to which the insurance provider would provide the benefit.

In other words, the health insurance of sum insured, say, $ 100,000 per year, may pay for treatment cost of only $50,000 per event (treatment). It means that a person, though eligible for expenditure up to $100,000 per year, can claim the total sum insured if he or she undergoes two treatments in a year, i.e., $50,000 per eventuality treatment

Certain health plans have their cap specific to a disease. For example, in Secure Cover’s Elite plan, the treatment for a natural tooth in case of accident or injury may not exceed $250 per natural tooth and a total of $ 1,000 for such treatment in a policy year.

The necessity to check the exclusions and sub-limit

1. Avoiding the chances of Financial Shock

People usually make the mistake of considering their health policy to universally cover each eventuality, which is a wrong interpretation of health insurance. There are always specific diseases or conditions which the insurer would not reimburse or cover for their customer. Hence, reading and identifying all the exclusions and sub-limit would save one all the financial shock after discovering that particular disease and eventuality would not be covered.

2. Being Ready to Pay out-of-Pocket for certain treatment

While some illnesses are critical and require emergency care, others such as gallbladder or kidney stones are not that severe, and a person does not face any severe or life-threatening complications doing their daily task. Identifying and reading about time-based category exclusions can help one take the health insurance early in their life to sit through their waiting period and eventually undergo treatment when the plan starts covering the illness.

3. Avoiding any unnecessary or unreasonable cost

This is important in the case of sub-limits. The cost of treatment varies depending on the hospital or medical institution. Moreover, while health insurance pays for treatment and treatment-related expenditure, it does not pay for any unreasonable or extravagant expenditure.

Suppose, if a person’s health insurance covers only a standard room rent worth expense in a general ward. At the same time, he or she is kept under observation after surgery; the insurance plan will not pay the cost of a single room or a high-cost hospital room for the same sum insured coverage.

4. Filing the claims after reading appopriately

Ignoring exclusions such as OPD treatment may lead to the insured filing for a claim on OPD expenditure involving X-ray, blood test, that too, without getting admitted to the hospital, may lead to rejection of the claim by the health insurance.

5. To save money on premium

Certain health insurance companies provide customers the option in their health plans to add few exclusions and then categorize their compensation into specific groups in return for a lower annual premium. Knowledge of such exclusions and sub-limits can help save money.

Let’s Wrap Up!

Every Health insurance plans have some exclusions and sub-limits that limits the coverage for specific disease or events. The exclusions depend on the categories that are mentioned above.

Sub-limit puts a cap on the health insurance plan’s amount for a particular treatment and related service in order to secure the interest of insurers too. Knowing exclusions and sub-limits could help in many ways possible, including the prevention of any financial shock and preparing to pay out-of-pocket for specific treatment

Disclaimer: The content of the following blog is based on the personal research of the writer. Readers are advised to exercise discretion and carefully read the terms and conditions while purchasing any health insurance policy. Secure Cover will not be liable for any wrongful interpretation of the content of this article.

*Conditions Apply