Nowadays, health insurance companies have become better at understanding the needs of their clients. They know that they need to offer flexible group insurance plans in order to meet such needs. Every employee has unique needs and they will not be satisfied with their group plan unless these needs are met.
The group health insurance voluntary top-up option is one such way in which insurance companies provide flexibility in their group plans. Earlier, group plans used to be highly rigid and one-size-fits.
However, these days, insurance plans have become much more sophisticated and better at solving the needs of users.
What’s on this page?
In this guide, we’ll cover everything you need to know about voluntary top-ups in group health insurance policies:
What is Voluntary Top-Up?
Every policy comes with a sum insured along with sub-limits for various diseases. The “sum insured” is the maximum amount that can be claimed from an insurance company under a policy. Also, almost every policy has “sub-limits” for different diseases. This means that the most that can be claimed for the treatment of these diseases are limited by the “sub-limit.”
Hence, there is a need for a voluntary top-up in group health plans because the total sum insured may not be adequately high enough to provide complete coverage in the case of expensive medical treatments.
Voluntary top-up essentially means that the sum insured under a policy can be increased if the need arises. To get a voluntary top-up, the policyholder will have to pay a higher premium.
Consider a situation in which the sum insured under a policy is Rs. 5 lakhs. However, a medical emergency occurs, and the total cost of treatment turns out to be Rs. 7.5 lakhs. In such a case, it would have been helpful to have availed of a voluntary top-up of Rs. 5 lakhs.
With the voluntary top-up, the user would not have had to pay Rs. 2.5 lakhs for their medical treatment from their own pocket.
How Does it Work?
A voluntary top-up needs to be availed at the time of availing the policy or at the time of renewing the policy. A higher premium needs to be paid in case a voluntary top-up is opted for under an insurance plan.
The voluntary top-up kicks in after a claim amount reaches a certain deductible amount. It does not have any effect if the claim amount is lower than this deductible amount. For example, the deductible amount can be Rs. 2 lakhs on a policy with a sum insured of Rs. 5 lakhs and a top-up amount of Rs. 3 lakhs.
In such a scenario, the sum insured becomes Rs. 8 lakhs in case the claim amount exceeds Rs. 2 lakhs.
The voluntary top-up is useful because it provides an additional coverage amount in case the claim amount crosses a certain threshold. However, for claims of a lower amount, the top-up will not have any effect.
When to opt for Voluntary Top-Up?
Healthcare costs are rising every year in India. Part of it is due to inflation, while part of it is due to increasing demand for healthcare services. In such circumstances, it can become necessary to have a health insurance plan which can cover medical costs in case the need arises.
A low sum insured can mean that the policyholder will need to cover any additional costs from their own pocket. This is less than ideal when you’re already paying for health insurance. If you feel like your group health insurance does not provide a sum insured that is high enough to cover potential medical conditions, then opting for a voluntary top-up is your best option.
Since group health insurance plans are designed to cover the basic needs of every member, the covered sum insured may not be sufficient for someone who is older or who has greater medical needs. The GMC top-up is a highly useful add-on that brings more flexibility to group health insurance plans.
Employee health insurance top-ups are a great way for employees to take charge of their health. It ensures that every employee has the required coverage to meet their healthcare needs. The voluntary top-up option adds some much needed flexibility to group plans, which may not have an adequate sum insured for everyone’s needs.