Health insurancepolicies often include cost-sharing features like deductibles, excess, and co-payments, which determine how much you’ll have to pay before or along with your insurer’s contribution.

Understanding these terms can help you choose the right policy and avoid surprises during claims.

A deductible is a fixed amount you must pay out-of-pocket before the insurer starts covering medical expenses.

Type of Deductible

The type of deductible usually differs from one insurer to another, and fall among the below types:

• Compulsory Deductibles: - This is a fixed amount determined by the insurer that you must pay at the time of an event or claim. It's non-negotiable and is designed to ensure that policyholders share the costs with insurers.


• Voluntary Deductibles: - Voluntary deductibles are for policyholders who are willing to bear a larger portion of the claim or are doing so to lower their premiums by agreeing to a higher deductible. If you choose this option, you agree to a larger out-of-pocket payment at the time of claim.


• Aggregate Deductibles: - Aggregate deductibles are different from a typical per-claim deductibles, which apply separately to each claim.An aggregate deductible is calculated cumulatively over a specific period, usually a policy year.This means that over the course of a policy year, the insured is required to bear a specified total amount out-of-pocket for all claims combined before the insurer starts contributing.


• Cumulative Deductibles: - Cumulative deductibles apply to family floater health plans. In this type, a family is insured under one policy with a shared deductible. The total deductible is cumulative, meaning it's spread among all family members. This option is often more cost-effective for families, as it allows them to cover multiple individuals under a single plan.

• A co-payment (co-pay) is a fixed percentage of the medical bill that you must always pay, while the insurer covers the rest. Unlike deductibles (which are fixed amounts), co-pay is a percentage-based cost-sharing agreement.

Types of Co-Pay

Age-Based Co-Pay: As you age, the likelihood of medical issues increases, leading to higher treatment costs. To offset this risk, insurers often include mandatory co-pay requirements - usually for senior citizens. This ensures that older individuals can still access coverage, even as healthcare expenses rise.

Hospital Network Co-Pay: If you choose a hospital outside your insurer’s network, a higher co-pay may apply to reimbursement claims. However, if you opt for a network hospital, you can usually avail of a cashless claim with no co-pay. This is to encourage policyholders to seek treatment at partner hospitals where insurers have pre-negotiated rates.

Medical Condition-Based Co-Pay: Some policies include mandatory co-pay for specific illnesses such as critical conditions or pre-existing diseases. Since treatments for these conditions are typically expensive, insurers require policyholders to bear a fixed percentage of the cost to help manage financial risk.

Location-Based Co-Pay:Medical expenses are generally higher in metro cities than in smaller towns. To account for this, insurers may apply a co-pay for claims made in high-cost urban areas while keeping co-pay lower (or zero) in smaller towns and rural regions.

• A sub-limit is a cap on how much the insurer will pay for specific medical expenses, even if your total sum insured is much higher.

For example: Psychiatric treatments may be covered under your health insurance plan up to a maximum amount (sub-limit) of ₹ 30,000, even if your overall sum insured is much higher.

Some common Sub-Limits in Health Insurance:

• ○ Room Rent Capping - Many policies restrict room rent (e.g., ₹5,000 per day or 1% of the sum insured per day). If you opt for a higher category room, you may have to pay the difference plus a proportionate deduction on associated expenses like doctor fees and surgery costs.
• ○ ICU Charges - Some policies cap ICU charges (e.g., 2% of sum insured per day).
• ○ Surgery-Specific Limits - Certain procedures (e.g., cataract surgery, knee replacement) may have a fixed reimbursement limit, even if your total sum insured is high.
• ○ AYUSH Treatment Limit - If your policy covers alternative medicine treatments, there might be a sub-limit on how much you can claim.
• ○ Ambulance Charges - Many policies cap ambulance coverage (e.g., ₹2,000 per hospitalization).
• ○ Maternity Benefits - If included, maternity coverage usually has low sub-limits (e.g., ₹50,000 for normal delivery, ₹75,000 for C-section).

• A waiting period is the specified time after your health insurance policy starts during which certain conditions or treatments are not covered.

Some waiting periods in a health insurance policy usually are:

• ○ Pre-Existing Diseases (PED) Waiting Period

• Duration: Generally 24 or 36 months from the policy’s start date (unless the Policy Schedule specifies a different period).
• Coverage: Expenses for treating a pre-existing condition and its direct complications are not covered during this period.
• Enhancements: If you increase your sum insured later, the waiting period applies again for the additional amount.
• Portability Benefit: If you maintain continuous coverage (as defined under IRDAI portability norms), the waiting period may be reduced based on your prior coverage.
• Declaration Requirement: After the waiting period, coverage for pre-existing diseases kicks in only if these conditions were declared and accepted at the time of application.

• ○ Specified Disease/Procedure Waiting Period

• Duration: A 24month waiting period(unless the Policy Schedule specifies a different period) applies for the treatment of certain listed conditions, surgeries, or procedures.
• Accident Exception: This waiting period does not apply to claims arising from accidents.
• Enhancements: Similar to pre-existing conditions, if you enhance your sum insured, the waiting period resets for the increased amount.
• Portability Benefit: If you maintain continuous coverage (as defined under IRDAI portability norms), the waiting period may be reduced based on your prior coverage.
• Overlap with PED: If a specified disease also falls under the pre-existing conditions category, the longer waiting period will be enforced.
• Continuous Coverage Benefit Continuous coverage (without any break, as per IRDAI norms) can reduce the waiting period, reflecting your previous coverage history.

• ○ 30-Day Initial Waiting Period

• Duration: The first 30 days from the policy’s commencement are subject to a waiting period.
• Coverage: Any illness occurring within these 30 days is not covered, except for claims arising from accidents (if accidents are covered by your policy).
• Renewal Benefit: This 30-day waiting period does not apply if you have maintained continuous coverage for more than twelve months.
• Enhanced Sum Insured: When the sum insured is increased, this waiting period also applies to the enhanced portion.

Understanding these waiting periods is crucial as they determine when you can start claiming for specific conditions. Continuous coverage and policy portability may help reduce waiting periods, ensuring that your coverage becomes more comprehensive over time.

Note: The information provided herein is for general informational purposes only and is intended to serve as an illustrative guide. Specific document requirements, notification time frames, and procedural details may vary significantly between different insurers and policies. This summary is not intended to be comprehensive or a substitute for the actual policy wording. For precise and up-to-date information, please refer to your insurer’s official policy documents or contact them directly.