​Are Corona virus health insurance plans a substitute for Mediclaim?

Last Updated: Mar 01, 2021 | 509 Views
The outbreak of the Corona virus pandemic has perhaps been a wake-up call for many of those without any health insurance coverage for self or their family members. Depending on the period of stay in a hospital, the cost of hospitalization can run into a few lakhs of rupees. Those who had health insurance policies saw the insurance companies pay up the hospital bills. However, those who didn’t have any health cover had to pay from their own pocket. If you do not want to dip into your savings to pay for the rising medical bills, it's time to avoid procrastination and buy adequate coverage at the earliest.

About Coronavirus health plans 
With the Covid-19 not looking to go away in a hurry, the insurance regulator IRDAI in 2020 had asked insurance companies to offer exclusive Corona virus health insurance plans. There are two sets of such Coronavirus health insurance plans in the market today – Corona Kavach Policy and Corona Rakshak Policy. You can buy Corona Kavach Policy, the COVID Standard Health Policy, from any general or health insurance company but life insurance companies cannot offer them. To buy the Corona Rakshak Policy, you may approach any insurer, including any life insurance company. The biggest difference between the two is that in the Corona Kavach Policy only the hospital bill gets reimbursed as it is an indemnity-based plan, but in the Corona Rakshak Policy, 100 per cent of the sum insured is paid to the policyholder as it a fixed benefit plan.

How they help
The importance of Corona virus health insurance plans cannot be undermined, especially in these times. Such plans cover hospital expenses towards patient isolation, use of personal protective equipment, diagnosis and treatment of pre-existing or developing co-morbidities etc. It is advisable that you choose an adequate sum insured, keeping your age, city of residence, type of hospital, your current and any past health conditions etc into consideration.
Another advantage of Corona virus health insurance plans is that you need not continue to pay the premium till lifetime as they are short-term plans. A regular health insurance is a must-have and in addition Corona Kavach Policy or Corona Rakshak Policy may be purchased to enhance coverage. In case there is a claim on any Corona virus health insurance plan, the no-claim bonus on the existing health insurance plan is not immediately impacted.
In both Corona Kavach Policy and Corona Rakshak Policy, even co-morbidity arising out of treatment of Covid-19 is also covered but both of them are of short-duration. In view of it being a short-term plan and the on-going incidence of the virus, including the impending impact due to mutation of the virus, it's better to choose a longer-term policy with a high sum-insured.

Are they sufficient?
However, before you run to buy a Corona virus health insurance plan, knowing what they have to offer is important. Can they be considered to be a replacement for regular Medical insurance plans? Both the Corona virus health insurance policies will help you in meeting hospital expenses arising out of Covid-19 and not if the hospitalization is because of any other ailment. The extent of coverage, therefore, is restricted in them as their sole purpose is to meet Covid-19 related hospital costs. While the minimum sum insured is Rs 50,000 in both the plans, the maximum cover is Rs 5 lakh and Rs 2.5 lakh in Corona Kavach Policy and Corona Rakshak Plan, respectively. As the maximum amount is restricted, do not treat corona virus health plans as a substitute of Mediclaim.

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Also, the plans are short-term in nature and will be available for a policy tenure of 3 ½ months, 6 ½ months, and 9 ½ months, including the waiting period. For taking care of your family's health insurance needs, you need a regular Medical insurance plan that can keep providing coverage till lifetime.

Not a substitute to Mediclaim
The need to buy health insurance coverage for self and family is to avoid dipping into one's savings to meet the cost of hospitalization. Mediclaim plans are much comprehensive in nature and cover hospitalization due to any medical events, including accidents. The spectrum of coverage in a health insurance policy is wide after taking into account features such as maternity coverage, OPD and day-care treatments etc.

Do not, therefore, consider a Corona virus health insurance plan as a substitute for a regular health insurance plan. Both Corona Kavach Policy and Corona Rakshak Policy are not a replacement to your health insurance needs, but will supplement your existing health insurance coverage. If you haven’t taken a health insurance plan as yet, it's time to evaluate a well-crafted health cover portfolio to take on the risks from all fronts.

Sunil Dhawan
Sunil Dhawan writes on personal finance topics including insurance. Having worked in insurance companies in the past, his insights have benefited readers to make informed decisions while purchasing insurance plans.