OPINION Can unlimited health insurance eliminate the fear of falling short of coverage?

Employee-funded group health insurance plans can complement independent retail health insurance covers

For as long as health insurance has existed, one question has dominated the minds of customers and insurers alike: how much is enough? Medical inflation, lifestyle diseases, and the rising cost of advanced treatments have made this question increasingly relevant.

Families worry whether their health cover will hold up against tomorrow’s uncertainties. The industry, in response, has tried to innovate - from introducing reinstatement of sum insured, super top-ups, cumulative bonus, carrying forward unutilized sum insured, inflation protection benefit to name a few.  A common thread across all these and many more innovations have been ‘sum insured’. In fact, ‘sum insured’ is not just an amount, it’s at the very core of health insurance products as a concept.

No matter how big that number is - Rs 10 lakh, Rs 50 lakh, even Rs 1 crore - the anxiety still remains: What if it still falls short? To end this anxiety forever, we need an innovation which would take the conversation around sum insured out of the equation.

Here’s one example: Rahul*, a young professional, purchased a health insurance plan with a sum insured of Rs 15 lakh, believing it was more than enough. However, little did he know that in a few months he would be diagnosed with cancer. His treatment involved multiple rounds of chemotherapy, surgery, and prolonged hospital stay, which costs approximately Rs 25 lakh in a year.

Also Read: Do you need an unlimited health insurance cover?

Despite his seemingly adequate coverage, Rahul had to pay Rs 10 lakh out-of-pocket, plunging him into financial distress. His sum insured was high, yet the protection fell drastically short when faced with the reality of complex, costly medical treatment like cancer. Some of the newer cancer treatment procedures available in India can cost upwards of a crore. Healthcare is an area of tremendous and continuous innovation with newer treatments, equipment and drugs introduced as well as ever rising costs.

In hindsight, Rahul wonders if he had opted for a higher sum insured would he have been completely shielded from these extra expenses? With more coverage, those unexpected costs would have been fully covered, providing him with true protection and financial security when he needed it most.

Chasing Higher Sum Insured

Health insurance, at its core, is meant to provide peace of mind. Yet, ironically, it often leaves customers with lingering doubts.

• What happens if I face multiple hospitalisations in a year?
• What if the costs of a new, advanced treatment are far higher than my cover?
• Will my policy keep pace with medical inflation?

How Unlimited Health Covers Work

Unlimited health coverage can ensure that customers no longer need to make educated guesses about tomorrow’s medical costs or worry if their cover will keep up. Instead of calculating hospital bills against coverage limits, families can concentrate on recovery and well-being. It’s about ensuring that healthcare needs 10, 20, 30 years down the line will still be met without a single thought about inflation or limits.

Also Read: How to estimate the right health insurance cover amount

Unlimited Health Insurance vs Top-ups

For decades, the health insurance industry has measured product strength by a number - Rs 10 lakh, Rs 1 crore, Rs 5 crore. With a base policy offering unlimited coverage, there may no longer be a need for top-up plans, floater concepts, or booster plans to augment insufficient sum insured amounts. The core purpose of these additional offerings is to bridge the gap between a policyholder's needs and their existing and future coverage limit. However, a single, comprehensive plan with an unlimited sum insured can eliminate this gap, providing a safety net against any medical expenses, regardless of their magnitude.

*Example used purely for illustration purposes.

Disclaimer: The views expressed by experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with a financial advisor before taking any decisions.