Just diagnosed with a critical illness - can I get a health insurance policy now?

How often does this happen to you! – there is a lucrative offer for investing and you cannot make up your mind. Your friends or colleagues take this chance and put in their money and within no time they start enjoying really good returns. This leaves you with a bitter experience and you promise yourself to be more active the next time such an opportunity shows up. Well, we all have our share of experiences of not taking quick decisions at the right time and then living with a quiet regret. Be it investing in a property, gold, airline tickets, shares, mutual funds or insurance, everyone has seen the advantages of buying things early and at low prices.

But with so many choices around us today, it is understandable when people take a lot of time to decide and finalise their purchase. People want to give time to each of their purchase and more importantly want to understand the core benefits of buying a product or service. People get into multiple interactions with the sellers and extend the buying process to weeks and at times up to several months. Even though such a lengthy process may help in saving some money and choosing a better product, sometimes it can cost us much more than what we are capable of managing. To explain this better, think about the case of Rajendra Shah who kept evaluating health insurance from 5 companies for 8 months but did not buy any. Just a month ago, when he was experiencing mild abdominal pain, Mr. Shah went to the local medical centre for a check up and found out that he was showing symptoms of stomach cancer.  The medical centre advised him to conduct a few tests and referred him to couple of bigger and better equipped hospitals. Also when it comes to critical illnesses such as cancer or heart diseases, doctors themselves would advise to take expert medical opinions from two separate hospitals which means double the cost. Such situation hits the individual both emotionally and financially plus his personal life hits a road block. If there is no health insurance like in the above case, then the person or his family members have to break in to their savings to meet the costs of tests and overall treatment. Frequent visits to hospital means lesser time towards work and there is often a dip in earnings be it a job or one’s own business.

Mr. Shah was in a great fix. He cannot go back to any of the five insurance companies he was speaking to and buy a policy without revealing his disease. And if he mentioned that he has been diagnosed with a disease, then there is a high chance that the insurance company will reject his application. Even if an insurance company considers his overall medical history and issues him a policy, then they would not cover this particular disease or any illness related to the same under the exclusion clause of Pre existing diseases. Any pre existing disease would be only covered if the customer renews his health insurance policy with the same insurance company for 3 or 4 years as per the policy rules.

So what should one do when faced with such a situation? Should a person who has been diagnosed with one illness still avail a health insurance or drop the idea completely. We suggest that the person should still seek an insurance cover. However, now because the situation has changed, one may need two or more health insurance policies to achieve what could have been done with a single health insurance plan earlier.

Step 1: Apply with the Public Sector Insurance Companies
First, approach one of the public sector general insurance companies and apply for their mediclaim insurance cover. You could go approach companies like Oriental Insurance or United India Assurance directly or if your bank is tied up with any of the insurance companies, then you can buy the insurance policy from your bank too. Example – PNB Oriental Mediclaim, BOI National Swasthya Bima, Baroda Health Policy, etc. Even if the insurance company is offering you a moderate sum assured of 2 to 3 lacs, take it.

Step 2: Approach the Private Insurance Companies
The second step is to apply with any of the private health insurance companies from the wide variety of health insurance policies offered by them. Few of the general insurance companies who have popular health insurance products are Apollo Munich, HDFC Ergo, Max Bupa, Bajaj Allianz and Star Health. Unlike the public sector insurance companies who would usually have only one mediclaim policy, the private sector companies will have 4 to 5 different kinds of medical insurance – one policy offering cash benefit, another covering critical illnesses only, one specially tailor made for senior citizens and of course the standard health insurance. 

Declare all personal details, medical history, family medical history, etc in the application form wherever the company is requesting for it. At such times, many people would advise you to withhold information and not reveal the same – while it is tempting to do so, we strongly advise you not to indulge in any misrepresentation of facts. Sooner or later the insurance company will find out about this and they will reject all your claim requests.

Here you face a high probability of rejection during the application stage itself but that should not stop you from being honest. Private insurance companies understand the high risk involved and may accept the application by charging a slightly higher premium.

Step 3: Take a top up insurance policy
Once you have taken the basic mediclaim (health insurance) policy from one of the insurance companies, then avail a top up medical insurance policy. Top up policy means if your basic (and primary mediclaim) policy is of Rs. 3 lacs then expenses over and above Rs. 3 lacs will be paid by this top up policy. The top up policy works like an add-on policy or a second policy. Also the premiums of such top up plans are very low. Some of the top up plans are United India Top up policy, Star Health Super Surplus, etc

Why Multiple policies!
Now the idea behind this approach is to
1) safeguard you against any unknown health related issues in future
2) start the process of protection which may be able to cover your existing illnesses in few years

Important Points
To be sure that everyone has registered the key points in their minds, here’s a quick recap of the important things –
1) Always reveal correct information and complete medical history at the time of application
2) Renew your health insurance policy every year without any break
3) Try to take health insurance policies from two or more companies to be on the safe side
4) If possible, avail a top up insurance policy in addition to the basic mediclaim
5) Do not hide any detail from the insurance company at the time of application or making a claim

The fundamental concept of insurance is to protect an individual from any unforeseen circumstances which may affect his/her financial position. In recent times, insurance companies do realise that they also need to shield people from existing situations if the individual is ready to pay the corresponding premium and wait for a few years. Of course, this in no way justifies postponing the purchase of a product as crucial as health insurance. So remember that you can take the liberty of postponing your health insurance purchase only if you are covered to some extent in the first place.