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Top 5 Benefits of Top-Up Health Insurance Plans

Published On Jan 11, 2021 5:30 AM By Sakshi Aggarwal

A life care top-up acts as an add-on to the main health cover. It contributes to the existing health insurance plan with more protections. Therefore, if the covered amount of your health insurance plan is not adequate to meet the cost of medical treatment, buying a top-up health insurance plan and increasing coverage is good.

Top 5 Benefits of Top-Up Health Insurance Plans

Top 5 Benefits of Top-Up Health Insurance Plans

1. Top-up health insurance plans are a support to your health insurance plans after you exhaust the sum assured limit. A regular health insurance plan reimburses medical bills up to the sum assured whereas a top-up plan health insurance plan covers costs after a specific limit is reached. Here are the top 5 benefits of a top-up health insurance plan

2. Increased Coverage: Even though your existing health insurance policy gets exhausted when you file a claim, you are still covered with a top-up health insurance plan for the rest of the period. If you wish to increase the sum insured on your health insurance plan, it can only be increased to a certain extent. Every health insurance provider chooses to what extent it can permit its policyholders to increase the sum assured of their coverage. However, if you buy a top-up health insurance plan, you can choose what amount of coverage you want to purchase.

3. Top-Up Plans are Cost-Effective: It is more cost-effective to buy a top-up health insurance plan than to increase the basic coverage of the existing health insurance policy. And that is the main reason why some policyholders opt to purchase it rather than increase the base cover on the current health insurance policy. It acts as a dual benefit with a higher insured sum at a lower cost and this is a beneficial and a viable option for senior citizens or older age group people who have a higher probability of falling ill or are vulnerable to many ailments

4. Combat Rising Medical Expenses and Covers Pre-Existing Diseases: With rising medical inflation, investing in a top-up health insurance plan can help the policyholder combat inflation effectively. The policyholder can pass on the risk to the health insurance company and hence reduce their financial burden. Also, you can supplement your base health insurance plan with a top-up health insurance plan which offers coverage for pre-existing diseases, which regular health insurance plans do not offer. This is advantageous in case there is a family history of illnesses such as diabetes, hypertension, cardiac ailments, etc

5. Tax Benefits: You can enjoy tax benefits like any other health insurance plan. Under IT Act 1961, tax benefits under Section 80D, you can reduce your tax liability up to INR 25000. This is allowed for the insurance plan that you have purchased for your spouse, dependent children, and self. In the case of senior citizens, they can avail of higher tax deduction, that is, a limit of INR 50,000.

Bottom Line

Top-up health insurance plans complement your existing health insurance plans to cover the actual healthcare expenses, without replication of coverage, while managing expenses reasonably. Top-up health insurance plans guarantee that there is adequate coverage and that insurance does not end when the real necessity arises.

Also Read 

Difference Between Top up and Recharge in Health Insurance

Difference Between Top Up and Super Top Up Health Insurance Plans

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.

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