As a financial expert, we are getting this query very often: Does my health insurance policy covers covid-19 and if yes, then upto what extent?
So we thought to write an explanatory blog that will help you to understand things better.
Does your Health insurance policy or Employer insurance policy cover corona related expenses?
If yes, why do we hear huge deductions & rejections while settling a claim from an insurer?
Recline yourself as we have come up with answers to these questions.
Yes, your Health Insurance & Employee insurance policy covers Covid related expenses, but it comes up with many ***** conditions, restrictions & deductions.
If you have a Health insurance policy, it will cover your hospitalisation expense, but in this case, you need to consider deductions at the time of claim settlement as below: –
- In most cases, it will not cover PPE kits, Sanitization cost, waste management cost & any other charges that are majorly covid specific because your insurer considers these all are part of room rent charges.
- If you have a cap on room rent in your policy, then approximately 30% to 50% claim might get deducted because your insurer pays you on a proportionate basis for cost like doctor’s visit.
- If you don’t have a room rent cap, then you will find a breather because deduction would be way far lesser somewhere around 10%-15%.
As per the data from GIC (General Insurance Council) in Feb-2021, claims paid were only 54% for a covid patient, rest 46% got rejected or considered as a deduction which client or his family has paid from their pockets.
Situation 1
Now let’s consider that if you have a Health Insurance policy, you are not hospitalised, and treatment is being done at home.
Please do pay attention over here!!
This is a situation where many of our clients are struggling to have clarity & I presume that it will be helpful to even you.
First & foremost, you need to check whether your policy offers you domiciliary treatment (treatment at home). If yes, then what are the clause & limits??
If there is a domiciliary treatment provided by your policy then you need to consider the below points:-
- Health insurance mostly covers only hospitalisation expenses. But if there are no medical facilities available or you are too critical to go to a hospital.
- You can claim only a certain part of the sum assured.
- Your treatment needs to last for at least 72 hours.
- A COVID positive report from an IMCR approved lab.
- A doctor’s prescription recommending home isolation and treatment.
- Hospital-like treatment means hospital-like infrastructure is required for a patient to get treatment. Homecare treatment is needed because either bed is unavailable or the severity of the patient cannot travel to the hospital.
- Some insurer wants that their clients should inform them in advance the cost of the home treatment, which means you need to let them know that you will claim for this Homecare treatment during your covid infection.
- Also, take care that day to day active management of the patient is required by a doctor like a doctor visit & even record of the same.
Situation 2
The answer to this is a clear NO: As this has been considered as a mild symptom & insurance company only reimburses the significant dent to your savings or monetary losses.
This all applies to even Employer health insurance: There can be some deviations depending upon the addition or deletion of clauses agreed between your employer & insurance company.
Now let’s talk about some special supplementary corona cover introduced by IRDAI:
The insurance regulator, IRDAI (Insurance Regulatory and Development Authority) has issued various circulars asking health insurers to make their plans more customer-centric and inclusive.
On July 10, 2020, two new health plans were launched called Corona Rakshak and Corona Kavach.
This will be a temporary cover which will protect you from this pandemic at a lower cost & all insurer has to mandatorily provide this cover as per their eligibility criteria.
Here’s a quick look at both –
Corona Kavach:-
Corona Kavach is an indemnity health plan covering the actual cost of hospitalisation and treatment that is incurred if the insured tests COVID positive and are hospitalised or hospital-like treatment is given at home with the below-mentioned condition:
- Covid-19 positive report from government registered laboratory. ( It should have ICMR authorization & SRF number).
- Hospitalization like infrastructure is mandatory over here and should be prescribed by the doctor at home. Even here mild symptoms & recovery from oral medication might not be considered.
- The doctor’s active management of the patient must maintain the record for the same.
The only difference between the corona kavach & Health Insurance policy is that in Health Insurance Policy; you need to prove the non-availability of beds in your surrounding area.
Kindly find below the list of the things covered: in the Corona Kavach Policy:
- Diagnostic test: Covered
- Medicine bills: Covered
- Cost associated with medical procedures: Covered
- No sub-limits are there in-home treatment of the patient
- PPE kit, oximeter, oxygen cylinder: Covered
- Doctor & nursing fees: Covered
Is it required for you?
We would recommend if you have room rent limits on your base health plan or you want to temporarily fix the inadequacy of your cover on health plan or cover home treatment (Hospital like infrastructure).
Corona Rakshak: –
This is again covid specific cover which works as a Fixed benefit plan which means you will be paid your sum insured amount if you get hospitalized for more than 72 hours.
- You should be tested positive from a government-regulated laboratory.
- You should be hospitalized for more than 72 hours.
This policy will not pay you your fixed pay if you are hospitalized at home.
- Not all Insurers are providing this policy as this is not mandatory from IRDAI.
You might have a question that, how this policy helps or who should opt for this one?
Actually, this policy will help you to cover your loss of income while you were not well.
It will also help to cover your deductions in your Base Health insurance policy.
Phew!!! If you got a bit tired by reading this whole; then you can refer to this table below, which will help you to clarify your doubts.
| Particulars | Health Insurance Policy | Employee Health Insurance | Corona Kavach | Corona Rakshak |
|---|---|---|---|---|
| Age | Depends on Insurer. | NA | Not available above 65 age | Not available above 65 age |
| Tenure of Cover | Lifetime | Your employment | Temporarily- Available for 9.5 months | Temporarily- Available for 9.5 months |
| Type of Claim | Reimbursement | Reimbursement | Reimbursement | Fixed Benefit |
| Sum Insured Limits | NA | Depends on Employer | 50K to 5Lacs | 50K to 2.5Lacs |
| Pre & Post Hospitalization cover | May not be covered | May not be covered, but depends on Employer | Covered | NA |
| Minimum time in hospital | 24 hours | 24 hours | 24 hours | 72 hours |
| Home treatment | Covered with many conditions | Depends on the clauses but yes conditions will be there | Covered with lesser conditions | Not covered |
| Waiting Period | 15 to 30 days | 0 to 15 days | 15 Days | 15 Days |
| Waiting period for co-morbities(like BP or Sugar) | Yes, it might be covered | Yes, it might be covered | Yes, it might be covered | It pays fixed cash, so not applicable. |
| Room Rent Cap | Depends on policy to policy | Depends on policy to policy | No, there is no cap, upto sum insured | It pays fixed cash, so not applicable. |
| Cover for PPE | Not covered | Depends on policy to policy | Covered separately | It pays fixed cash, so not applicable. |
| Cover for sanitization cost | Not covered | Not covered | Yes, it covers | It pays fixed cash, so not applicable. |
| For Home Treatment-Doctors Prescription | Yes | Yes | Yes | Yes |
| For Home Treatment-Proof of non-availability of Bed | Required | Required | Reimburse you despite of bed availability | NA |
| For Home Treatment-Daily Monitoring & Record Maintenance | Required | RequiredRequiredNA | RequiredNA | NA |
| Mild Symptoms or recovery from Oral Medication | Not covered | Not covered | Not covered | Not covered |
To conclude on above, we would put our recommendation in a nutshell: –
First & Foremost, you should have an Emergency corpus of at least 3-6 months based on the dependent members.
For long term needs of health, the cover takes an adequate base health insurance policy.
For a temporary period, to avoid a dent in your finances and to avoid disturbing your planned expenditures we would recommend supplementary cover (covid specific covers).
If you have any further questions or doubts, we are happy to help you.
FAQ-
1. Does my Health Insurance cover covid-19?
Ans: Yes, your health insurance covers covid-19, but there are multiple deductions & other condition like sanitization cost, PPE Kit cost & other covid specific costs which all are included in room rent charges.
2. Can I get cashless insurance claims for covid-19?
Ans: Yes, a few weeks ago Nirmala Sitharaman told IRDAI to ensure that all network hospitals- even temporary ones’s provide a cashless claim for covid-19 to eligible policyholders.
3. Difference between Corona Kavach & Corona Rakshak?
Ans: Corona Kavach is an indemnity policy where you will get paid for the cost which you have born (reimbursement) upto 5 lacs. Corona Rakshak is a Fixed Benefit policy upto 2.5 lacs.
4. Is Covid-19 treatment covered at hotels?
Ans: Yes, on 16th July’20, the IRDAI had released a circular stating that temporary or make shift hospital permitted by the state or central government would be regarded as hospitals for the purpose of insurance.
5. Is Covid-19 treatment covered at home?
Ans: Yes, this will be called domiciliary hospitalization, you can claim only a certain part of the sum insured & treatment needs to last for at least 72 hours.
6. Can I get insurance for covid-19 after I start showing symptoms?
Ans: No, Both standard covid-19 insurance policies, corona kavach & corona rakshak have a waiting period of 15 days & for regular health insurance, a waiting period of 30 days is applicable.
7. Is death due to covid-19 is covered under a term insurance plan?
Ans: Yes, your insurer will treat death due to covid-19 just like it would any other untimely death.
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