Impact of drinking on health insurance

• Premiums as low as Rs12/day for coverage of Rs.4 Lakhs*
• 10,000+ hospitals for cashless treatment
• Claim up to Rs. 55,000 deduction under section 80D**

Health insurance companies may choose who they want to issue health insurance plans to. Applicants are generally required to submit personal and medical details to the company. The insurer will then verify the details and evaluate the health risk of the individual. The higher the health risk, the higher the premium will be or higher the possibility of rejection of the application. Many factors could contribute to a person’s high health risk and alcoholism is one of them.

High premiums for alcoholics

Health Insurance, like other financial products, is a game of risk vs. returns for the insurance companies. This means that insurers often tend to look closely when an applicant claims that he/she is an alcoholic as the risk, in such cases, will be slightly higher for the insurers. While alcohol doesn't cause any health problems in the short term, long term usage can result in severe organ damages resulting in hefty hospital bills. The insurance firms may be reluctant to provide cover for such individuals. And those who are ready to take on the risk charge a slightly higher premium in such cases.

Risks of alcoholism

Alcoholism brings with it several health issues that will gradually deteriorate the health of the body. Here are some of the health consequences of alcoholism:

• High blood pressure
• Liver disease
• Pancreatitis
• Worsens cardiovascular diseases
• Heart failure
• Certain cancers
• Stroke
• Brain damage to an unborn child
• Serious accidental injuries
• Death

Alcohol exclusion

Alcoholism not only reduces the possibility of a person availing health insurance coverage but can also eliminate the possibility of claim settlement. This is because one of the common exclusions of all health insurance policies in India is that injuries or illnesses caused by alcoholism or caused under the influence of alcohol cannot be claimed.

Health insurance plan features for drinkers

While it may be difficult for a drinker to avail a health insurance policy, it is certainly not impossible. Insurance companies may issue a policy but charge a higher premium. Insurers test if a person is a moderate drinker or a heavy drinker. If a person has been a moderate drinker for a short period of time, he/she may be able to avail at least a basic health insurance policy. Here are some of the features of the basic health insurance policy he/she may be offered:

• In-patient hospitalisation: The costs incurred on treatment while being hospitalised will be covered. The insured, however, may have to pay a certain share of the amount due to the co-pay clause.
• Co-payment or deductibles: Health insurance companies have the co-payment clause wherein the insured individual will have to bear a percentage of the costs incurred. The percentage, in most cases, can be chosen by the insured. The co-payment percentage chosen is one of the determining factors of the health insurance premium. So, if a person opts for a high deductible, he/she will have to pay a comparatively low premium.
• Cashless facility: If a person chooses to get treated in a network hospital, he/she can enjoy cashless transactions. The insurance company will pay for the hospital bill at the time of discharge.
• Lifelong renewability: Health insurance policies are generally offered with lifetime renewability. The policyholder is required to renew the policy from time to time to enjoy the benefits offered.

As established, drinking alcohol has various harmful effects on health insurance policies. It is, therefore, advisable to avoid drinking and lead a healthy lifestyle. However, if one is an alcoholic, it is important to disclose the fact to the insurance company at the time of application. If the fact is not reported and the insurance company finds out that the applicant had not disclosed the fact, it may choose to reject the claim or terminate the policy altogether.