Why You Should Never Buy Insurance Without Comparing?

by Vinaya HS on December 18, 2016

in Finance

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Health insurance is an important financial instrument that may be used by individuals to secure their future well-being. It is a form of cashless health insurance that allows you to create a pool of resources. This may be used in the future to meet all your medical needs right from laboratory tests, check-ups, to hospitalization fees.

In order to keep up with the ever-increasing inflation and rise in the medical fees in India, it is imperative that you avail of a health insurance plan that meets your requirements. These plans ensure you can receive quality healthcare facilities without facing any financial constraints.

Health insurance purchase cycle

Generally, there is a specific process through which you avail of an insurance policy. While the initial stages focus on increasing awareness and knowledge, the final stage involves the actual payment of premium wherein you stand to benefit from the policy coverage.

The insurance purchase cycle may be divided into the following three stages:

1. Awareness

During this stage, you as a consumer, conduct extensive research in order to familiarize yourself with various insurance policies. It is imperative that you compare health insurance policies in order to understand the benefits of each. During this initial stage, review the terms and conditions of various insurers. This will help you narrow down the list of insurers that meet all your requirements and make an informed decision.

2. Quote review

This stage requires you to engage in thorough mediclaim policy comparison. Most leading insurers allow you to receive instant quotes online which may be the basis of your decision. You should consider reviewing the insurer’s website in order to solve any queries you may have. This is the stage wherein you make up your mind regarding a particular policy you intend to avail of.

3. Acquisition

Purchasing a policy is the next stage wherein a determined sum is to be paid as premium. Also, the insurer mentions the fixed sum insured at this stage. Moreover, you experience coverage as per the terms of the policy and over a longer period of time, you may choose to renew your policy and make claims.

The importance of comparing health insurance plans:

You must always compare health insurance policies before purchasing one. Without comparison, you may not know which health policies offer a cashless benefit or which ones are based on the copayment model. Therefore, experts stress heavily on the need to compare health insurance policies before signing on the dotted line.

Four factors you should keep in mind while comparing health policies are listed below.

1. Insurance portfolio

Comparison of insurance affects the way you invest in your health in various ways. Your insurance portfolio may consist of diverse products purchased by you including family floater plans and riders.

2. Under-insuring

This is a situation where you have not purchased adequate coverage. Although certain policies offer lower premiums, you must review the extent of their coverage and the sum assured. Neglecting to review either of these would cost you in terms of both, mental stress as well as financial crunch.

3. Over-insuring

While conducting mediclaim policy comparison, you must analyze whether there is any overlapping with your existing policy. The purchase of overlapping policies leads you to overspend on coverage that offers you no benefit. You should focus on acquiring adequate coverage that is also financially viable.

4. The reputation of the insurer

While some insurers may choose to market their low premiums or additional facilities, it is important to consider their claim settlement ratios and reputation in the market. This is extremely important as it allows you to gauge your own chances of claim approval and payout.

Comparison plays an essential role in the process of availing of policies. While conducting research on the insurers, it is advisable to frequent consumer feedback forums. This grants you an insight into the workings of the company and satisfaction levels of its existing customers.




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