Jyoti has been long suffering from diabetes, ever since she was in her early teens, and has spent quite an amount on healthcare and medical expenses over the years. She’s delaying her decision to buy a health insurance plan, not knowing how much cover she will receive if she were to invest in it.
Define pre-existing medical condition
Any condition, ailment or injury or related condition(s) for which you had signs or symptoms, and / or were diagnosed, and / or received medical advice / treatment within 48 months to prior to the first policy issued by the insurer.
Now, if you were to apply for a health insurance policy on January 1, 2016, and in between Jan 1, 2011 to December 31, 2015, you’ve shown signs or were diagnosed with such a condition, maybe even received medical advice or undergone treatment for it, then your condition will be considered as a pre-existing one.
Due to the standardized definition that all insurers have to follow, the impact of pre-existing medical conditions on a health insurance policy is somewhat similar.
Full disclosure condition
Every insurer will require a full disclosure of your medical history, regardless of a pre-existing medical condition, however, it is recommended, that you come forthright with any such conditions beforehand. Failure to do so will end in a rejected claim.
Vital criteria in policy issuance decision
There is a standard underwriting guideline that all insurers follow to determine whether you qualify for the health insurance policy. If they choose to provide the policy, despite the pre-existing medical condition, then it will be under these conditions.
- A waiting period will be applied before the condition is covered in the policy.
- The additional risk will be covered through ‘loading’ i.e. higher premiums.
- You may be covered, but not for your pre-existing condition.
- People with chronic illnesses or exceptional cases will have their policy applications denied.
Definite waiting period before the policy covers the Illness
Keeping Jyoti’s example in mind, if she was to be hospitalized for diabetes within 1 year to 3 years after her policy is issued, then based on the waiting period mentioned, the insurer has the right to deny her claim. So what must she do until then to prevent a financial crisis? She keeps a separate corpus for medical expenses until the policy takes care of it for her.
A pre-existing medical condition does dampen your need for medical insurance, however, that should not deter you from purchasing one, since it is better to have some safety than none at all. A few simple precautions and timely disclosure could ensure you receive a claim without any hassles.