They were there when you uttered your first words when you learned to walk, they even defended you when you got into a brawl with your neighborhood bully. They saw you through school, college, and most of your childhood and teenage life. They held you by your hand and showed how the world works but time catches up and tables turn. Your parents may not be fully dependent on you financially but fending off ill health can certainly take the sweet afterglow out of their twilight years.
Increasing job insecurity and medical inflation have made young adults think hard about getting the apt insurance coverage for their parents. In India, parents invariably depend on their children for financial support at the time of retirement. Today let us discuss more on this topic:
The market for senior citizens’ health insurance in India
In India, IRDAI Health Regulations stipulate that insurance providers have to offer a minimum entry age of 65 years, in their health plans. Until the recent past, there was no such condition and it was difficult for individuals more than 65 years to get good insurance coverage. However, recent innovations in this space have led insurers like Apollo, and Star to design plans specifically for senior citizens, which provide health insurance coverage to those as old as 80 years. In these plans, the entry age starts at 61 and goes up to 80 years. While another plan covered here that is not entirely senior citizen-centric is Religare Care. But there is no upper limit on entry age and the sum insured goes up to Rs 60 lakhs.
Comparison of senior citizen insurance policies in India
After a review of the brochure and policy wordings of the respective products, below is a comparison table whereby the plans are compared on a few key parameters so that you can get a broad idea about the available options:
As we can see from the analysis, if we consider the sum assured, owing to the peculiar risk nature of the policies from this segment, the majority of health insurers restrict the sum assured to Rs. 5 lacs (the exception being Star which offers upto Rs. 10 lacs is a strong plus). Although not strictly a plan for the elderly, Religare stands out as it has no upper limit restriction on entry age, which makes it easy for senior citizens to enter the plan, and the sum insured is Rs. up to 60 lakhs.
All policies have a mandatory 30-day waiting period for new issuances. As for the pre-existing diseases, though Star offers the lowest i.e. 12 months, please note that it is not as good as it might seem, as there is a lifelong 50% co-pay for pre-existing diseases. In such a case, Apollo’s 3-year waiting period is the second best and without any co-pay based on pre-existing conditions. National policies offer a day 1 cover for diabetes/hypertension patients but it is not of much value as the sum assured in the policy isn’t much.
Though there is no single best policy and it depends on individual needs and preferences, Apollo Munich Optima Senior happens to be the best among the lot, as per the above analysis. The policy wordings of this plan are the cleanest among all the policies and it also has minimum capping/sub-limits etc. Its co-pay and waiting periods are also in line with the norm and coverage are also adequate.
Some points to remember while buying these policies
Though these are specially designed policies for senior citizens, if your parents are aged less than 65, try first covering them in the regular plans like Apollo Munich Easy Health, or Religare Care. Here, the benefit is that you can get a good enough sum assured right from the start, innovative features like the sum assured restoration and multiplier benefits, overseas treatment, etc. which are not available in these plans. Mind you, even in those plans, there are co-pay conditions so you’ll need to read the fine print. For senior citizens suffering from diabetes, do also check the specific policies like Apollo Munich Energy.
When you buy insurance coverage for parents, do not club them in your own plan. Buy separate individual plans for them or club both your parents into a family floater. Also, do not miss claiming the separate tax deduction u/s 80D for parents of Rs. 25,000 (Rs. 30,000 in case parents are> 60 years). Also, remember that this deduction is available also to NRI & parents need not be financially dependent on you. If you want to cover your in-laws, a better tax planning strategy is to get your spouse to pay for them instead of yourself, so that she can claim the tax benefit in her return.
Also, senior citizens must be aware of their rights under the IRDA’s Health Insurance Regulations which include fair and transparent disclosure by insurers in premiums, obtaining specific consent on loading before issuing the policy & establishing separate channels for senior citizens in matters of claims and grievances.
