Understand Some Commonly Used Terms In Health Insurance Policy
Published On Apr 01, 2022
Health insurance policies are very comprehendible, it provides compensation for medical expenses incurred by the insured during the policy tenure. A health insurance policy is a must nowadays, provided that the cost of medical expenses have risen and health insurance policy can help an individual cope up with it. To have a better understanding of health insurance policy one should know about the terms, jargons or terminologies which are commonly used under a health insurance policy.
There are some terminologies used under a health insurance policy that a policy holder should be aware of. This way the policyholder can have a better understanding of how the health insurance policy works.
Commonly Used Terms In Health Insurance Policy
Explained below are some terms that you must know about in order to understand your health insurance policy better.
- Co-payment - Co-payment is a clause under some health insurance policy where both insured and the insurance provider pay for the medical expenses incurred by the insured for the medical treatment taken during the policy tenure. In simple words, under the co-payment clause the insurance provider reimburses a percentage of the medical expenses incurred by the insured and the rest is paid by the insured person itself.
- No Claim Bonus - No claim bonus under health insurance refers to the reward that the insurance provider gives to the insured for not making any claim under health insurance policy for a particular year.
- Network Hospital - Every health insurance company has an associated network of hospitals wherein the insured person can have cashless treatment. These hospitals are often called network hospitals. As a policyholder, one can find a list of network hospitals associated with their insurance provider.
- Pre-existing Diseases - Pre-existing diseases refer to the disease for which the insured person had been diagnosed prior to the purchase of a health insurance policy. Generally, there is a waiting period under health insurance for the insured to be able to avail coverage for pre-existing disease.
- Portability: Portability refers to porting of health insurance policy from one insurance company to another. This can be done in case the insured person is not satisfied with the terms and conditions of the present health insurance provider.
- Sum Insured: Sum insured is the payout amount that the insurance company is liable to pay as a claim. It is the amount that the policyholder chooses at the time of purchasing the health insurance policy.
- Waiting Period: Waiting period refers to the time period under which the health insurance provider does not cover you. Waiting periods can have different categories such as initial waiting period which is 15-30 days starting the date of issuance of health insurance policy, waiting period for pre-existing disease.
Above mentioned terminologies can help you understand the working of a health insurance policy in a better manner. It is always important to make informed financial decisions. And since the decision about health insurance also involves your health along with your finances, it becomes even more important to make a well-informed decision.