Things you must know about pre-existing conditions in 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 has become an absolute necessity in the recent days. If you are someone who belongs to a middle class family in India, a proper health insurance plan is absolutely must to ensure protection against unforeseen medical expenses. People who are healthy and maintain an active lifestyle can get insurance coverage without much difficulty. However, this may not be the case if you are suffering from some form of pre-existing illness. In order to gain more insights into this, let’s first define what exactly is a pre-existing illness.

If you are taking a medical insurance policy, a pre-existing illness is a medical condition that already exists at the time of signing up for a policy. A pre-existing disease could be anything ranging from diabetes to asthma. From an insurer’s point of view, customers with pre-existing illnesses are considered too risk to avail coverage under a regular health insurance plan. This is one of the main reasons why most insurers impose specific conditions when it comes to providing coverage for pre-existing conditions.

Coverage for pre-existing illnesses

The Insurance Regulatory and Development Authority of India (IRDAI) mandates that all insurers must provide coverage for pre-existing illnesses. To prevent insurers from incurring losses, the General Insurance Council, an umbrella body established by the IRDAI, prescribed a waiting period up to 4 years before coverage can begin for pre-existing illnesses.

All insurance companies operating in India follow this guideline when providing service for customers. The waiting period for pre-existing conditions may vary from one insurer to another. There are companies that offer shorter waiting period. You may take the waiting period into consideration while shortlisting companies for health insurance purchase.

Declaration of pre-existing illnesses

As per the guidelines set forth by the IRDAI, any pre-existing conditions that was treated (or even cured) within 48 months prior to the issuance of policy must be declared to the insurer. Even if you have been cured for a condition that you have experienced before, it is better to declare this to the insurer in order to avoid future complications.

It is estimated that most of the insurance rejections in India happen because of pre-existing illnesses. Companies reject the applications of people who are deemed too risky because of their pre-existing conditions. Though there is a risk of rejection, it is better for applicants to declare their conditions as insurance is something based on mutual trust. If an insurer finds out about these conditions at the time of a claim, it could lead to outright rejection of the claim or even cancellation of the policy. In such cases, the policyholder might be in a bigger financial trouble.

Things to note about pre-existing illnesses

Before you opt for a health insurance policy, please keep in mind the following things about pre-existing conditions:

• Premium loading: In certain cases, the insurance company may agree to cover your pre-existing illness on condition that you pay higher premium charges. This is called premium loading. While insurance companies cannot load premiums after the issuance of a policy, they can charge higher premiums at the time of subscribing to a policy.
• Medical checkup: Sometimes, you may not even be aware of the existence of certain conditions until you do a medical checkup. This is one of the reasons why most companies insist on a medical examination for people applying after a particular age. The conditions diagnosed during this checkup will also be treated as pre-existing conditions, and they will be subjected to the same waiting period/premium loading as per the guideline.
• Not every small illness is a pre-existing disease: You may visit a doctor multiple times in a year due to minor conditions like cold, fever, flu, or other seasonal diseases. However, these cannot be considered as pre-existing diseases. A pre-existing disease is something substantial for which you must have received treatment over a specific period of time.
• Terms may vary: The terms on pre-existing conditions may vary from one insurer to another. It is very common for pre-existing conditions to have waiting period of 2 to 4 years in India. When you are choosing a medical insurance policy, make sure that you compare the waiting period for pre-existing illnesses.
• Never hide your pre-existing conditions: In certain cases, people might be tempted to hide their conditions to take advantage of other benefits. It is not a wise idea to hide your existing illnesses from your insurer. Even if you are successful in getting policy, this may get found out during the time of a claim. When an insurer finds out about this, it may lead to rejection of claim or even the entire policy. Rather than just facing a waiting period, you may end up with no insurance at all.
• Permanent exclusion for pre-existing conditions: In certain cases, the severity of a condition may lead an insurer to permanently exclude a specific pre-existing condition. This may leave you with no choice. However, a silver lining here is that you may not have to worry about the coverage for any diseases other than your pre-existing condition.
• Denial of policy: As noted earlier, pre-existing condition is one of the major reasons for rejecting a policy application in India. When a condition is extremely severe, an insurer may consider it to be extremely risk to provide coverage to a person. As per the IRDAI regulation, a company has the right to deny a policy to certain people based on this criteria. You can avoid this by signing up early when you are in good health.

Conclusion

Pre-existing diseases play a major role in health insurance. If you want to avoid these conditions set forth by insurers, your best bet is to start your health insurance cover early at a young age. When you are young and healthy, the insurance premiums will be lower and you can avoid the waiting period clauses or other issues related to pre-existing illnesses. If you are already suffering from pre-existing conditions, make sure that you compare the policies to get the best deal you can find.