7 Health Insurance Mistakes That Cost Lakhs
Health insurance mistakes can lead to claim rejections, insufficient coverage, or lakhs in out-of-pocket expense during a medical emergency. Low coverage, ignoring waiting periods, skipping personal policy, and not checking sub-limits are common errors. This guide lists seven mistakes: what they cost, why they happen, and how to avoid them. Use our Health Insurance Calculator to estimate your coverage needs.
Key Takeaways
- Coverage: ₹5–15L minimum in metros. Don't underinsure to save premium
- Waiting period: 2–4 years for pre-existing. Buy early; don't wait for illness
- Personal policy: Employer cover ends on job change. Always have your own
- Network hospitals: Check list before buying. Cashless only at network
- Sub-limits: Room rent, ICU caps. Read policy; top-up if needed
Mistake 1: Choosing Low Coverage to Save Premium
A ₹2 lakh policy saves premium today but can leave you short during a serious hospitalisation. A bypass or cancer treatment can cost ₹5–15 lakh in a metro. Choosing ₹10 lakh or higher (₹25–50 lakh for family) is wiser. The premium difference is often small compared to the risk. Use our Health Insurance Calculator to estimate coverage based on city, family size, and age.
Mistake 2: Ignoring Waiting Periods
Most policies have a 2–4 year waiting period for pre-existing diseases (diabetes, hypertension, etc.). If you buy after diagnosis, claims for that condition may be rejected for years. Buy health insurance early (in your 20s or 30s) when you're healthy. Porting can help reduce waiting if you switch insurers; check portability rules. Don't hide pre-existing conditions—it can lead to claim rejection and policy cancellation.
Mistake 3: Not Checking Network Hospitals
Cashless treatment works only at network hospitals. If your preferred hospital isn't in the network, you'll pay first and claim later—and reimbursement can take weeks. Before buying, check the insurer's hospital list in your city. Ensure major hospitals you'd use are included. Some policies have a larger network; compare.
Mistake 4: Relying Only on Employer Insurance
Employer health insurance ends when you leave the job. You may have a short grace period, but then you're uninsured. Job loss plus medical emergency is a double blow. Always have a personal health policy. It stays with you across jobs. Employer policy can be a top-up; personal policy should be your base cover.
Mistake 5: Ignoring Sub-Limits
Many policies have sub-limits: room rent (e.g. 1% of sum insured per day), ICU caps, or procedure-wise limits. A ₹10L policy with 1% room rent allows ₹10,000/day—enough in Tier 2, tight in metros. Read the policy document. Prefer policies with no or high sub-limits, or buy a top-up to cover gaps.
Mistake 6: Not Disclosing Pre-Existing Conditions
Hiding diabetes, BP, or past surgeries can lead to claim rejection. Insurers verify medical history at claim. Non-disclosure is grounds for rejection. Declare all conditions; you may pay slightly higher premium but your claims will be honoured. It's not worth the risk.
Mistake 7: Not Reviewing Policy Regularly
Family size grows, parents age, medical costs rise. A policy that was enough 5 years ago may be inadequate now. Review every 2–3 years. Top up or buy additional coverage if needed. Add parents to a floater or separate policy. Keep coverage in line with inflation and family needs.
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Disclaimer
Policy terms vary by insurer. Read the offer document. This is general guidance; consult an insurance advisor for your situation.