Did You Know Your Health Insurance Sum Insured Increases For Claim-free Years?

If you have not made a claim on the mediclaim insurance plan you purchased last year, you have every reason to be pleased. Not only had you demonstrated good health, but you also managed to obtain some financial benefits from your health insurance policy.

Given that you had already paid the premium to purchase the policy and that no claim was made, you may be yet to receive any returns. You may be wondering what benefits we are referring to. This should encourage you to purchase or renew your insurance policy this year. This is because policyholders are rewarded for having a claim-free year.

In fact, by not filing a single claim in a year, you have increased your chances of receiving increased financial benefits under your mediclaim insurance policy.

Let us all learn about the advantages of purchasing health insurance –

Health insurance is a type of risk cover –

Refrain from being misled into believing that mediclaim plans should always be used by filing a claim to get the most bang for your buck. Making a false claim can be problematic from a legal standpoint. Health insurance is a method of protecting against health risks. It is a financial safety net in case of unforeseen circumstances that may necessitate out-of-pocket expenses.

Even if no claims are made during the year, the premium you pay to purchase the policy provides you with returns in the form of a secure future for your family. The mediclaim insurance policy protects your finances in an unexpected medical emergency. What you eventually get is the assurance of a worry-free lot.

Advice: It is wise to check the health insurance premium calculator to identify affordable premiums depending upon your required add-ons.

How cumulative bonus works –

1. Higher sum insured:

If an insured person does not claim during the year, they are eligible for an increased sum insured under a  cumulative bonus (CB) feature. The sum insured grows by a percentage determined by the insurance company. There is usually a maximum increase limit, such as 50% of the original sum insured.

For example, suppose a person purchases a mediclaim insurance plan with an amount insured of Rs 5 lakhs. Furthermore, the insurer provides a 5% CB with a maximum limit of 50%.

  • The sum insured will be Rs 5 Lakhs 25 thousand after the first claim-free year.
  • The sum insured will be Rs 5 lakhs 50 thousand after the second claim-free year.

If the person claims in the following year, the available sum insured amount is considered.

2. Premium costs are reduced:

CB is also available as a premium reward when renewing usual insurance or even senior citizen health insurance. In such cases, the sum insured remains constant while the insurance premium is reduced. Again, there is a limit to the maximum reward the policyholder can receive.

3. You saved money on your taxes:

Individuals who purchase mediclaim policies are eligible for a tax deduction as per Section 80d of the Income Tax Act. The deductions are determined by the number of people covered by the plan and their age. For example, for someone under 60, the deduction is Rs 25,000, whereas, for senior citizens, the deduction is Rs 50,000.

Considering the preceding, the health insurance policy you choose for yourself, and your family has aided in the accumulation of savings. So, if you file a claim, you have ensured substantial benefits that will boost your finances.

Determine which health insurance’s mediclaim plans are ideal for you. Take the necessary steps toward good health and receive a cumulative bonus each year you are claim-free.

 * Standard T&C Apply

** Currently, there are 2 tax regimes in India – new and old. To get the tax benefit you desire, choose the correct one after consulting an expert. You can opt for a regime change during the next financial year.

## All savings are provided by the insurer as per the IRDAI-approved insurance plan. Standard T&C apply

Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.