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Choosing a Well-designed Supplementary Health Insurance Cover

By Vikas Chandra Das
14 November 2022, 12:14 PM

Do I really need a supplementary health insurance cover is a question many people may be found wondering about? What is a supplementary health insurance cover in the first place, others might ask.

Many basic health insurance plans may only take care of hospitalisation expenses in case of illness and accidents. Most will not cover all medical expenses that one may have to undergo. Some may have some permanent exclusions such as walkers and wheelchairs, congenital external anomalies, dental implants, consumables, etc. Some may exclude certain critical diseases or complicated surgical procedures such as kidney failure, cancer, heart conditions or organ transplant. Most will not come with any coverage for OPD treatment and investigations.

What if you or any other members covered have a chronic condition that requires frequent visit to the general practitioner? What if one has a compromised immunity, requiring frequent pathological and other investigations and thereby high out-of-pocket expenditure? You may think you want to upgrade your health insurance plan so as to cover all possible contingencies and scenarios. However, the fact is, that finding a one-size-fits-all plan that covers all possible scenarios might be prohibitively expensive. Since a health insurance plan is a regular annual expense, you may not want to take such a financial burden on yourself.

Thus, if you want to protect yourself from high medical costs that are not covered by your plan, your best option is to buy a supplementary health insurance cover. A typical supplementary plan   along with a basic plan will generally cost less than the cost of a basic plan which provides the total coverage of both plans together.

However, as there are various plans offered by different health insurance service providers, you need to carefully choose the supplementary health cover that is well designed and suits your needs.

Here are some questions to help you shortlist and select the most appropriate supplementary health cover:

1. What are the diseases, illnesses or surgeries that your current basic plan does not cover? 

While there are likely to be many, you need to ask yourself if there are any of the diseases that you or your family members covered, are more likely to be susceptible to. The greater risk of contracting certain diseases or conditions may be due to occupational hazards – high stress levels, exposure to certain chemicals and substances that could result in chronic illness or life-threatening health issues. In some cases, the greater risk may come from hereditary issues – high blood pressure, diabetes, heart conditions or mental illness that runs in the family. Pinpoint these hazards and check if the supplementary health insurance plan is designed to take care of hospitalisation related to these conditions.

2.  Is the basic insurance plan designed to provide sufficient coverage? 

Are there limits to room rent? Is there a price cap on certain surgeries? If you are not comfortable with the amounts capped, you may want to consider a supplementary plan, usually in the form of a top-up that you can utilise towards additional expenditure incurred.  Make sure of the conditions to which the top up or supplementary health insurance is tied – does it only kick in once the original insurance is exhausted or can you use it to pay additional room rent or surgery costs?

3. What are the permanent exclusions mentioned in the basic plan document? 

What is the cost of protecting yourself against these? Since the supplemental plan is a recurring annual expenditure, is it worth the cost? Or is your risk appetite high enough to avoid the added cost?

4. Are the costs of out-patient department treatment and investigations covered by my basic plan? 

If not, are  members covered likely to need these services frequently? Will the expected cost of treatment be more than the cost of the supplemental cover? If yes, the next question to ask is if OPD cover is on cashless or reimbursement basis, and whether medicine costs are covered? If not cashless, keep in mind that reimbursement processes are cumbersome, slow and tedious.

5. Does my basic insurance plan cover dental treatment and eye care?

If you or the members covered are likely to need such treatment, you may consider a supplementary plan that offers such a cover.

6. What is my budget for the supplemental health cover? 

It may be so that what the level of protection sought through the supplementary cover comes with a cost factor beyond your budget. You will then have to prioritise what you definitely want covered and what you are willing to take a risk with.

7. Do the supplementary plans offer any discount for the following year’s premium if I do not make any claim during any year?

 If yes, this could bring down the cost of the supplementary cover.


Finding a supplementary health insurance plan that is designed to meet all possible medical contingencies needs careful thought and planning. There are no one-size-fits-all plans. However, spending a little time studying the offerings of various service providers and plans before selecting your supplementary health insurance plan will drastically reduce your stress during illness and hospitalisation.


1. What are permanent exclusions?

There are some treatment costs which will never be covered by your insurance policy. These are classified as permanent exclusions. These could be expenses related to cosmetic surgery, gender change, chronic disease, critical illnesses, genetic disorders, consumables or dental treatment. Permanent exclusions differ from policy to policy.

2. What is a critical illness?

Most life-threatening medical conditions, such as cancer and heart disease, are referred to as critical illnesses. Once diagnosed with a critical illness, you may need to make several changes and adjustments to the lifestyle you enjoyed previous to diagnosis.

3. What are congenital anomalies?

These are anomalies, which may be structural or functional, that occur during the intrauterine stage of a child’s life. Sometimes these are referred to as congenital disorders. These may be detected before or after birth.

4. What is a group medical insurance policy?

A group medical insurance is insurance that covers a group of people that are bound by some common cause or purpose. A  group here would be members of an organisation or company who come together for some common activity, not simply for the purpose of availing health insurance.

5. What is a top-up plan?

Top up plans are plans which provide you coverage of expenses over and above the basic health insurance plan. Usually the benefits of such a plan can only be availed once meet the set deductible and keep your basic plan’s sum insured intact. 

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