An Insight into Top-up Cover in Health Insurance


According to a Chinese proverb, a small sickness brings you good fortune. But a serious medical issue requiring hospitalization can burn your pockets. A Health Insurance plan is your saviour here. But given the rising medical costs by about 20% annually, no coverage seems sufficient enough. If you try to increase the sum assured, you find the premium amount going way beyond your means.

The smartest way to tackle it is by buying a top-up health plan. It can be equated to the spare tyre or Stepney of a car. Causing just a marginal increase in your premium amount, it offers you several benefits. Here, we would try to gain a few insights into top-up health plans for you to consider every time you buy or renew your health policy.

What is a Top-up Health Plan?

On average, any individual buys a Health Insurance Plan of up to Rs. 5 Lakhs. Any sum insured beyond that takes the premium amount too high to be affordable for an average Indian family. However, the sum insured is simply not sufficient if a major disease like a heart attack creeps in. This is where the top-Up plan kicks in.

A top-up health plan is a useful policy that covers the additional cost of any medical treatment once you have exhausted the sum insured limit if your base health policy.

Let’s understand this with an example. If a person purchases a top-up cover with a deductible of Rs. 3 Lakhs. Now if that person is hospitalized and the total bill stands at Rs. 5 lakhs. Here, the first 3 lakhs would be paid by the base policy or from the patient’s pocket while the remaining two lakhs would be covered by the top-up policy.

Understanding Deductible

We just talked about the deductible in a top-up plan. It is an integral part of it. It is the base amount that must be borne by the policyholder before the top-up plan kicks in. Usually, the deductible is the sum insured amount of your base health policy after which the top-up policy kicks in. For instance, if you have a basic health policy of Rs. 5 lakhs and you take a top-up plan of any amount, its deductible would be Rs. 5 lakhs i.e. the sum insured of the base plan.

Types of Top-up Plans

Top-up plans are primarily of two types:

The first type is where the deductible limit is calculated for each instance of medical expenditure or hospitalization bills. For instance, if a person has a top-up plan with a deductible of Rs. 3 lakhs and got a total medical bill of Rs. 6 lakhs, he would need to foot the first Rs. 3 lakhs from his base policy or his pocket. The remaining Rs. 3 lakhs would be taken care of by the top-up plan.

The second type is called the super top-up plan. Here, we take the same policy as above but the person got hospitalized twice with the bill of Rs. 2.5 lakhs and Rs. 3.5 lakhs respectively. Here the total expenses of Rs. 6 lakhs are considered and the top-up plan kicks in after the deductible of Rs. 3 lakhs is exhausted for a given annual policy term.

Things Covered in a Top-up Health Plan

The coverage of a top-up plan varies from insurer to insurer. But a few of the general benefits that you can avail under a top-up plan includes:

  • Pre-hospitalization and post-hospitalization costs as per the guidelines of the policy.
  • Compensation for various in-hospitalization expenses like room accommodation, doctors and nurses’ charges, OT charges, oxygen charges, diagnostic procedures, etc.
  • Day-care procedures needing no hospitalization or admission for less than a day.
  • Emergency ambulance expenses.
  • Organ donor expenses
  • Domiciliary expenses, etc.

Benefits and Features of a Top-up Health Plan

There are several benefits of opting for a top-up plan. Few of its features and benefits are:

  • It helps you increase your sum insured limit without causing a major dent in your pocket. For instance, you take the sum insured of Rs. 10 lakhs in the first policy and again take a second policy with Rs. 5 lakhs as the sum insured of base policy and a top-up plan of Rs. 5 lakhs on it. You will find that your payable premium amount is significantly lower in the second case. This is the major advantage of a top-up plan.
  • The top-up plan is available for both individual and family floater health plan.
  • You can buy the top-up plan from the same insurance provider of your base plan or another provider.
  • You are eligible for tax discounts for your top-up health plans as well.
  • No pre-medical screening is required until the specified age.
  • You get the option of lifelong renewability
  • You get advantages like discounts and No Claim Bonus as well.

Wrapping up

Top-up health plans are an excellent choice to fill in the gap between the hospitalization costs and your ongoing health policy in an affordable manner. It is a must-have option for all.