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INDEX
SR NO 1 2 3 4 5 6 7 8 9 10 11 12 PARTICULARS DESIGN OF STUDY METHODOLOGY INTRODUCTION DEFINITION TYPES OF INSURANCE PRINCIPLES OF INSURANCE TYPES OF MEDICLAIM POLICIES BENEFITS OF MEDICLAIM NEED FOR MEDICLAIM INSURANCE PRECAUTIONARY MEASURES TO BE TAKEN FREQUENTLY ASKED QUESTIONS CASE STUDIES CONCLUSION BIBLIOGRAPHY PAGE NO 2 3 4 5 6 13 16 31 42 44 53 57
MEDICLAIM INSURANCE
CHAPTER 1 INTRODUCTION
MEDICLAIM INSURANCE
INSURANCE: AN INTRODUCTION
Insurance may be described as a social device to reduce or eliminate risks of loss to life and properly. It is a provision which a prudent man makes against inevitable contingencies, loss or misfortune. Once Frank H. Knight said "Risk is uncertainty and uncertainty is one of the fundamental facts of life." Insurance is the modern method by which men make the uncertain certain and the unequal; equal. It is the means by which success is almost guaranteed. Through its operation- the strong contribute to the support of the weak and weak secure, not by favor sent by right duly purchased and paid for, the support of the strong (Calvin Coolidge.) Under the plan of insurance, a large number of people associate themselves by sharing risks attached to individuals. As in private life, in business also there are dangers and risks of different kinds. The aim of all types of insurance is to make provision against such dangers. The risks which can be insured against include fire, the perils of sea (marine insurance), death (life insurance) and, accidents and burglary. Any risk contingent upon these, may be insured against at a premium commensurate with the risk involved. Thus, collective bearing of risks is insurance.
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Definition
Insurance in its basic form is defined as A contract between two parties whereby one party called insurer undertakes in exchange for a fixed sum called premiums, to pay the other party called insured a fixed amount of money on the happening of a certain event." In simple terms it is a contract between the person who buys Insurance and an Insurance company who sold the Policy. By entering into contract the Insurance Company agrees to pay the Policy holder or his family members a predetermined sum of money in case of any unfortunate event for a predetermined fixed sum payable which is in normal term called Insurance Premiums.
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DESIGN OF STUDY
SCOPE
Human resources management starts the moment an employee joints an organization and continues till he leaves the organization either on account of retirement, registration and death or otherwise. It covers every aspects of employee training, manpower planning etc
OBJECTIVES:
Human resource management is a fascinating and important subject. The fascinating lies in fact that it involves people and decision involving people artwork. It is human resources that determine the fact of an organization. I have selected the topic of job satisfaction and communication management because the quality of human resources is a critical factor in the success of any organization and more in service organization like banks.
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METHODOLOGY
In order to conduct the research an appropriate methodology became necessary. In this direction both primary and secondary data were required to be collected. The methodology for collecting secondary data was taken from the different published books, article, journals and relevant websites. The different libraries of the college, institution were of much great help. Questionnaire was prepared for the collection of primary data from different banks. These forms i.e. questionnaire was given to different banks for getting the information of their report on working of job satisfaction and communication management along with different other questionnaires. It was prepared to get detail information of an individual topic so we can get proper information and also the knowledge of the banks. After finalization of the questionnaire it was decided to approach different banks in the nearby areas. These questions were presented to the employees. The primary data collection was restricted only to banks. Thus the methodology became a preplanned strategy in collecting, editing, tabulating and interpreting the required information for the research. Hence, the methodology relied on both primary and secondary data with the help of questionnaire, discussions observations as well as published work and unpublished work.
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MEDICLAIM INSURANCE
TYPES OF INSURANCE
Life insurance
Life insurance is an insurance coverage that pays out a certain amount of money to the insured pr their specified beneficiaries upon a certain event such as death of the individual who is insured. This protection is also offered in a family tactful plan, a Shariah based approach to protecting you and your family. The coverage period for a life insurance is usually more than a year. So this requires a periodic premium payment, either monthly, quarterly or annually. The risks that are covered by life insurance are: Premature death Income during retirement Illness
General insurance
General insurance is basically an insurance policy that protects u against looses and damages other than those covered by life insurance. For more comprehensive coverage, it is vital for you to know about the risks covered to ensure that you and your family are protected from unforeseen losses.
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The coverage period for most general insurance policies and plans is usually one year, whereby premiums are normally paid on a one-time basis.
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DECADES OF MEDICLAIM
The concept of health insurance was proposed in 1694 by Hugh the Elder Chamberlin from the Chamberlin family. In the late 19th century, "accident insurance" began to be available, which operated much like modern disability insurance. This payment model continued until the start of the 20th century in some jurisdictions (like California), where all laws regulating health insurance actually referred to disability insurance. Before the development of medical expense insurance, patients were expected to pay all other health care costs out of their own pockets, under what is known as the fee business model. During the middle to late 20th century, traditional disability insurance evolved into modern health insurance programs. Today, most comprehensive private health insurance programs cover the cost of routine, preventive, and emergency health care procedures, and also most prescription drugs, but this was not always the case. Hospital and medical expense policies were introduced during the first half of the20th century. During the 1920s, individual hospitals began offering services to individuals on a pre-paid basis, eventually leading to the development of BlueCross organizations. The predecessors of today's Health Maintenance Organizations (HMOs) originated beginning in 1929, through the 1930s and on during World War II.
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MEDICLAIM IN INDIA
In mid 80s most of the hospitals in India were governments owned and treatment was free of cost. With the advent of Private Medical Care the need for Health Insurance was felt and various Insurance Companies (New India Assurance, National Insurance Company, Oriental Insurance & United Insurance Company) introduced Mediclaim Insurance as a product. According to recent news report Health insurance continues to be the fastest growing segment with annual growth rate of 55%. Health Premium has risen to Rs.3300 cores in 2006-2007. As per the recent reports from various agencies the Health sector has the potential to become a Rs. 25000-crore industry by 2010. On August 15, 2007 Prime Minister has announced Rs 2000 Cores for Health Insurance for poor citizens. We foresee that this amount will be partly in form of subsidy therefore during calendar year 2008 we can expect Health Insurance premium to touch figure in the range of Rs 10,000 Cores. In 2001 with entry of various private Insurance companies now the customers have choice of buying this insurance from 14 Insurance companies.
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India is the only country where hospitalization insurance policy was being soldas Mediclaim Insurance Policies. The very name gives a feeling to the insured that claim has to be lodged. If motor insurance policy is not sold as motor insurance claim policy and household insurance policy is not sold as household claim policy then why this is named as Mediclaim? In the recent years the trend has emerged that some Insurance companies have started calling this product as Health Insurance. Health Insurance and Mediclaim are two different names for the same product. The change has started coming and now we have started calling it Health Insurance.ICICI Lombard has even named it as Health Insurance Policy. Calling is as Health Insurance is a positive way of looking at this Insurance. It also giving us a feeling that we as a society have started moving from curative medical care to preventive medical care. According to sources in Oriental insurance it is being felt that mindset has started changing over the last couple of years The new middle- class of India aspires of quality healthcare service and doesnt mind going to expensive hospitals like Apollo or Escorts. There is no reason why healthcare insurance should not be successful with this class.
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Principles of insurance
1. Indemnity
A contract of insurance contained in a fire, marine, burglary or any other policy (except life assurance and personal accident and sickness insurance) is a contract of indemnity. This means that the insured, in case of loss against which the policy has been issued, shall be paid the actual amount of loss not exceeding the amount of the policy, i.e. he shall be fully indemnified. The object of every contract of insurance is to place the insured in the same financial position, as nearly as possible, after the loss, as if he loses had not taken place at all. It would be against public policy to allow an insured to make a profit out of his loss or damage.
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existence and loss from its destruction. The owner of a ship run a risk of losing his ship, the charterer of the ship runs a risk of losing his freight and the owner of the cargo incurs the risk of losing his goods and profit. So, all these persons have something at stake and all of them have insurable interest. It is the existence of insurable interest in a contract of insurance, which distinguishes it from a mere watering agreement.
4. Causa Proxima
The rule of causa proxima means that the cause of the loss must be proximate or immediate and not remote. If the proximate cause of the loss is a peril insured against, the insured can recover. When a loss has been brought about by two or more causes, the question arises as to which is the causa proxima, although the result could not have happened without the remote cause. But if the loss is brought about by any cause attributable to the misconduct of the insured, the insurer is not liable.
5. Risk
In a contract of insurance the insurer undertakes to protect the insured from specified loss and the insurer receive a premium for running the risk of such loss. Thus, risk must attach to a policy.
6. Mitigation of Loss
In the event of some mishap to the insured property, the insured must take all necessary steps to mitigate or minimize the loss, just as any prudent person would do in those circumstances. If he does not do so, the insurer can avoid the payment of loss attributable to his negligence. But it must be remembered that though the insured is bound to do his best for his insurer, he is, not bound to do so at the risk of his life.
7. Subrogation
The doctrine of subrogation is a corollary to the principle of indemnity and applies only to fire and marine insurance. According to it, when an insured has received full indemnity in respect of his loss, all rights and remedies which he has against 20
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third person will pass on to the insurer and will be exercised for his benefit until he (the insurer) recoups the amount he has paid under the policy. It must be clarified here that the insurer's right of subrogation arises only when he has paid for the loss for which he is liable under the policy and this right extend only to the rights and remedies available to the insured in respect of the thing to which the contract of insurance relates.
8. Contribution
Where there are two or more insurance on one risk, the principle of contribution comes into play. The aim of contribution is to distribute the actual amount of loss among the different insurers who are liable for the same risk under different policies in respect of the same subject matter. Any one insurer may pay to the insured the full amount of the loss covered by the policy and then become entitled to contribution from his co-insurers in proportion to the amount which each has undertaken to pay in case of loss of the same subject-matter.
In other words, the right of contribution arises when (I)There are different policies which relate to the same subject-matter (II) The policies cover the same peril which caused the loss, and (III) All the policies are in force at the time of the loss, and (IV) One of the insurers has paid to the insured more than his share of the loss.
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Coverage: the policy provides for the hospitalization/domiciliary hospitalization expenses for illness/diseases or injuries sustained. Expenses on hospitalization is payable when the insured is admitted in the hospital for a minimum period of 24 hours. An individual can opt for the sum insured ranging from Rs.15, 000 to Rs.5, 00,000 in multiples of Rs.5, 000. Eligibility: People in the between age group of 5 and 80 years are eligible for the policy. Children between the ages of 3 months to 5 years can be covered provided one or both parents opt mediclaim over.
Benefits:
Reimbursement of hospitalization/domiciliary hospitalization expenses as mentioned above. Family discount- a discount of 10% in the total premium is available if the policyholder is opting cover under the policy for anyone of the following: spouse, dependent children, and dependent parents. Cost of health checkups- this cost is payable to the insured at the end of every four year block 23
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provided there is no claim reported during the block. The cost reimburse will be the amount equal to 1% of the averages sum insured during the block. Premium of Rs.15, 000 is exempted under income tax section 80D, if paid bycheque. Conditions: Any event giving rise to claim under the policy should be informed or communicated to the insurance company in writing within 7 days from the date of injury, hospitalization/ domiciliary hospitalization. Claim must be filed within 30 days from the date of discharge from the hospital. The company will not be liable for any payment for claim, which are fraudulent or supported by any fraudulent device.
II. Group medical policy: The group medical policy will be available to pay or association, institution or corporate body of more than 50 persons provided it has central administration point. Each insurer should cover all eligible candidates under one group policy only which means that different categories of eligible members are not allowed to be covered under different group Medicalim policies. The group discount is permissible depending upon the total number of insured person covered under the group mediclaim policy at the inception of the policy. It is to be noted that no discount is offered to a group with less than 101 members. III. Overseas Mediclaim policy: Overseas Mediclaim policy was originally introduced in 1984 to provide payment of medical expenses incurred in respect of illness suffered or sustained by Indian resident during their overseas trips. The insurance scheme, since 1984 has been modified several times to provide for additional benefits like in-fight personal accident, loss of passport etc. in the year 1991, employment of study policy was introduced for Indian citizens temporarily living abroad.
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Standard cover.
Videsh yatra mitra.
Eligibility:
The policy is available to the following person: Indian residents traveling abroad for the following purposes: Business Official Holiday tour Professional Training Accompanying spouse and children of the person going aboard will be treated as going under holiday travel.
Age limit:
Adults: the age limit is 70 years. Adults between the age of 70 and 80 years can be covered at the discretion of the insurer by loading the premium and persons above 80, years can also be covered provided the insurance company's head office accepts the proposal.
Benefits:
The following are the important benefits of overseas medical policy: Reimbursements of medical expenses of the insured during his/her stay abroad. Automatic extension of insurance period. In the event of claim, services will be provided by M/s. Mercury international assistance and claims limited, whose services are available all over the world.
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V. Cancer policy:
This policy is designed to meet the risks or coverage for the members of the cancer patient aid association. There are two schemes available for cancer policy: a. Indian cancer society b. Cancer Patients Aid Association. This policy is introduced in collaboration with Indian Cancer Society can avail of the benefits of this scheme. The policy lapses immediately if the insured ceases to be a member of the Cancer society for any reason whatsoever. On payment of the prescribed membership fees, which is included in insurance premium during the currency of the policy suffers from cancer; the policy will pay up toRs. 50, 000 to meet the cost of diagnosis, biopsy, chemotherapy, hospitalization and rehabilitation.
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VI. Bhavishya Arogya Policy: This scheme had been designed so as to enable a person to provide himself for medical needs during an old age security. Under this policy the medical expenses to be incurred over the balance life span after a predetermined age of retirement will be reimbursed up to the amount of the sum insured with a limit of an amount per any one illness or injury. The amount of maximum total benefits available under the basic policy is Rs. 50, 000 during the lifetime of the insured commencing from the policy retirement age and is not to exceed Rs. 20, 000.
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5. Co-Insurance: A co-insurance is a policy provision that requires the insured to pay a certain percentage of the eligible medical expenses in excess of the deductible. The purpose of this clause is to reduce premium and prevent over utilization of policy benefits. Since the insured has to pay part of the bill, premiums can be offered at cheaper rates. Another purpose of the provision is to discourage the patients from simply choosing the most costly medical services while lowercost versions are available and are just as good. 6. Exclusions : Like all types of insurance policies, major medical plans contain exclusion clauses. Some of the common exclusions that are found in such plans are as follows: Expanses incurred as a result of war or military conflict. Optional cosmetic surgery. Normal dental care. Pregnancy and childbirth, except for complication that arises as a result of childbirth. Experimental surgery To further control cost, internal limits are sometimes imposed on the plan. There may be in the form of annual or lifetime limits on the amount paid for certain diseases.
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Exclusions: Diseases contracted within 30 days of insurance Dental treatment except arising out of accident. Debility and General Run down Conditions. Sexually transmitted diseases and HIV (AIDS) Circumcision, Cosmetic surgery, Plastic surgery unless required to treat injury or illness Vaccination and Inoculation Pregnancy and child birth War, Act of foreign enemy, ionizing radiation and nuclear weapon. Treatment outside India Naturopathy Domiciliary Treatment Experimental or unproven treatment All external equipments such as contact lenses, cochlear implants etc
Premium:
Premium is based on age of the proposer and geographical area of treatment. Special features of the policy: Discount in premium for family cover Loyalty Discount
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Good Health Discount Cumulative Bonus Cost of Health Check up Income Tax Benefit under Section 80D of IT Act.
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National Insurance
. Salient Feature Hospitalization for illness, Disease Accident, including surgery
2. Scope of Cover
Mediclaim insurance policy has been devised under the aegis of the Government of India. The policy provides the following benefits. 1) Reimbursement of hospitalization expenses which are reasonably and necessarily incurred, Under the following heads: a) Room, boarding expenses as provided by the hospital/nursing home. b) Nursing expenses. c) Fees of surgeon, anesthetist, medical practitioner, consultant and specialist. d) Expenses on account of anesthesia, blood, oxygen, operation theatre charges, surgical Appliances, medicines and drugs, diagnostic material, X-ray, dialysis, chemotherapy, Radiotherapy cost of pacemaker, artificial limbs and cost of organs and similar expenses. 2) Introduction of Sub-Limits: The following provisions have been introduced: A. Room, Board and Nursing Expenses as provided by the Hospital /Nursing Home- Room Rent limit: 1 % of the Sum Insured per day subject to maximum of Rs.5000./-. I.C. Unit Expenses: 2 % of Sum Insured per day subject to maximum of Rs. 10,000/-. Over all limits under this head: 25% of S.I. per illness.
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B. Surgeon, Anesthetist, Medical Practitioner, Consultants Special fees maximum limits per Illness 25% of S.I. C.Anesthesia, Blood, Oxygen, OT charges, Surgical appliance, Medicines, drugs,Diagnostic Material & X-Ray, Dialysis, Chemotherapy, Radiotherapy, cost of pacemaker, artificial limbs And cost of stint and implant. Maximum limit per illness 50% of Sum Insured. D. Ambulance services - 1% of the sum insured subject to maximum of Rs 1000/provided Registered ambulance is used for shifting patient from residence tohospital if admitted to ICU or emergency ward OR from one hospital to another subject to sub-limits under c above E. Hospitalization expenses of person donating an organ during the course of organ transplant Will also be payable subject to the sub-limits under c above. 3) Premium paid for the policy towards self, spouse, dependent children anddependent parents are exempt from Income Tax under Sec. 80D of the l.T. Act. 4) Cost of Health Check Up and Cumulative Bonus - Benefits will accrue only if the Policy is a renewal Of National.
3. Additional Features 1) Definition of Family: A) Self (Primary Insured). B) Spouse. C) Dependent Children (i.e. legitimate or legally adopted children). Children above 18 years, if employed, can not be covered. Male children, if not employed, but a bonafide student can be covered up to age of 25 years. Female children, if not
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D) Dependent parents. All members of the family must be covered under one policy. 2) Entry Age: This insurance is available to a person between the age of 18 to 59 years. However, the Policy can be renewed upto the age of 80 years as stipulated in the premium chart above. a) Children above the age of 3 months can be covered provided parents are covered concurrently and suitable premium is paid. If the child above 18 years is employed or if the Girl child is married, he or she shall cease to be covered under the policy. However male child can be covered up to the age of 25 years if he is a bonafide regular student and fully dependent on primary insured. Female child can be covered up to the time, she is unmarried. b) If the insured has taken continuous Mediclaim insurance policy with us for at least 5 years prior to attaining the age of 80 years the policy can be renewed beyond the age of 80 up to the age of 90 years as a special case with the approval of Regional In charge on case to case basis. The premium chargeable shall be 10%of the premium for 75-80 years age slabs for proposers above 85 and 20% of the premium for 75-80 age slabs for proposers above 90. c) No inclusion of family member during currency of policy is permissible except for a new born child between the age of 3 months to 6 months and newly married spouse within 60 days of marriage. Otherwise inclusion of family member shall be allowed only at the time of Renewal. Prorata premium shall be charged for such inclusion during the currency of the policy for the unexpired period. 3) Sum Insured: Minimum sum insured shall be Rs 50,000/- and can be increased in multiples of Rs25,000/-up to Rs 5 lacs. The sum insured must be identical for primary insured and the dependents. However, the children may be covered for 50% Sum Insured as per item no. 2 above. 4)TPA option: The premium includes cashless facility through TPA. If the policyholder does not require cashless facility then 6% discount on premium may be given.
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5) Pre -Acceptance Health Checkup:Pre acceptance health check-up is mandatory when age is 50 years and above and he/she is seeking insurance cover for the first time as an individual or as member of a family where there is break in Insurance increase in sum insured on renewal. Propose/Insured Person will be required to undergo the following Medical Checkup or any other medical test as required by the Company either on his/her own or from its authorized Network Diagnostic Centre in prescribed format. The cost shall be borne by the insured.
Age
(in years)
50 and above
RETINOSCOPY
If the insured was covered under any Health Insurance Policy of National uninterruptedly for Preceding 3 years, no pre-acceptance Medical check up is required.
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4. Exclusions
The most important exclusion relates to pre-existing illness. If the insuring person had a health condition, existing prior to taking the policy, which required medical treatment, the same gets automatically excluded in the policy. To ensure that in subsequent renewals medical conditions. Incepting since the policy was taken do not get excluded, the insuring person must renew the policy without break. The other exclusions for illustrative purposes are:a) Exclusion of certain named diseases in the first year of the policy. b) Congenital external disease, sterility, venereal disease, intentional self-injury, use of drugs, Alcohol, rest cure etc. c) AIDS d) Charges primarily for diagnostic, laboratory examinations, and not related to any treatment in hospital. So also for vitamins and tonics unless prescribed for treatment. e) Dental treatment not requiring hospitalization. f) Treatment arising from or traceable to pregnancy, childbirth, including caesarean. g) Naturopathy treatment. EXCLUSION 4.a, 4.b & 4.c have been amended . Pre-existing diseases shall be covered after 4 continuous claims free Policy years with National. However, incase of exclusion 4.3, for renewals, Existing condition shall apply, i.e. the one year exclusion applicable earlier shall be valid
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BENEFITS OF MEDICLAIM
Benefits of a Mediclaim policy are many. Some of which are listed below.
1) First and foremost the Mediclaim policy offers you a chance to get your medical expenses covered under a policy. Thus it takes care of the hospitalization fees. Protects the person or family (in case of family plan) for hospitalization expenses as a result of any specific injury or illness which has taken place during the period of insurance and on the advice of a doctor requires hospitalization. 2) Pre hospitalization expenses for the person or the insurer and also to go with it Post-Hospitalization Expenses: Post Hospitalization expenses are medical expensesincurred during a period up to a specific number of days after hospitalization for the particular ailment disease or injury is over but still needs expenditures in order to completely become normal. 3) If you have a health insurance policy that supports cashless Mediclaim, it means that you can get medical treatment just by displaying your insurance card without paying any cash to the hospital. Most health insurance companies offer this benefit. Some times the benefits may be applicable only to a certain number of hospitals or medical centers. 4) Some of the insurance policies also provide tax benefits. These tax benefits are provided to the person under the name of whom the insurance policy has been assigned. Under the Section 80D, tax benefits are provided to people who get a Mediclaim policy done in their n
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DOCUMENTS REQUIRED
Given below is a general list of documents that are required in case of a claim. 1. Duly completed claim form (available with all network hospitals). 2. Original bills, receipts and discharge certificate / card from the hospital. 3. Bills from chemists supported by proper prescription 4. Investigation test reports and payment receipts, supported by the note from attending medical practitioner / surgeon prescribing the test. 5. Doctors referral letter advising hospitalization in non-accidental cases. 6. Nature of operation performed and surgeons bill and receipt. 7.Any other documentation / information as required by the Service Provider/TPA.
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scrutiny of such claims so that in the event it is found that the insurance companies are taking recourse to arbitrary methodologies in the matter of entering into contracts of insurance or renewal thereof, appropriate steps on that behalf may be taken.
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4. The hospital shall then fax the signed and stamped form to the service provider. 5. The service provider then evaluates the documents and classifies the case as Approved, Queried or Rejected. Accordingly, the Authorization form would be faxed to the hospital. 6. It is advisable to follow the above procedure and get the Authorization Letter before getting admitted to avoid any disappointments. However, in case of an Emergency Hospitalization, the authorization form can be obtained after admission. 7. Note that the Cashless Authorization does not cover: Attendant/Visitor pass charges Ambulance chargesunless covered under the policy Special nursing charges not authorized by the attending doctor Charges for extra bed for attendant Purchase of Medicines not related to the treatment
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Additional information may be required from your GP at the time of claim If a claim can be paid under another insurance policy or by anyone else, we will only pay the proper share.
The main reasons for claim not being passed in full are
Insured has preexisting disease and it was already mentioned in policy document as exclusion. The specific diseases are not covered under the policy Disease is a preexisting disease and it was not revealed by the insured at the time of issue of policy. The main reasons for claim being passed in part are : Some of the tests conducted/treatment were not relevant to the disease for which patient was admitted. Some costs like consumables are not payable by the insurance company. Examples are :With a view to cover some of these payments some TPA's insist that 5% of the hospital bill will be paid by the patient. You should not be surprised if you are asked to pay 5% of the bill even if you are covered under cashless scheme. In the event of consumables are not 5% or more than 5% there is good possibility that you may get part of this paid to you at time of finalization of their claim. As a customer you should see that information being given at time of admission into the hospital, discharge certificate, claim form is consistent. Any follow up letter being sent to the insurance company should be well drafted and consistent to the claim lodged.
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Life can come at you fast. It's simply impossible to know what's around the corner. This is why we all have to take necessary precautions. In other words; do you have health insurance? Some people actually have no medical insurance whatsoever. This is completely absurd in the unpredictable world we live in. That random fall or dreadful car accident could happen today. Are you prepared to grapple with those hospital bills? The fact is, medical insurance is just an inevitability of life. You always want to have it just in case. If the time does arise when you need it, you will thank God you planned ahead.
However, a longer life need not mean healthier life. Lifestyle-related diseases such as high blood pressure, diabetes, obesity, and extraordinary stress are all on the rise. In short, we are looking at a combination of longer but possibly a less healthy life span. At the same time, healthcare costs have been escalating rapidly.
Landing up in hospital is the last thing we want to think about. It happens to someone else not meyou think. But we all go through tough times and only the ones that plan ahead come out unscathed. The massive cost of treatment is a double-whammy for many who already have to contend with the illness. If you become seriously ill, your entire wealth accumulated over decades can disappear in combating the illness. If your savings can vanish in the blink of the eye what is the best solution? The answer to this ominous question is opting for health insurance.
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These days, no medical insurance equals trouble down the road. Even a minor hospitalization can set you back for a long while. The problem is that most of us dont believe that we will ever use it. Get rid of your fantasies and purchase decent medical insurance plan today. Don't end up in the emergency room with nonmedical insurance. If nothing else, insurance offers you piece of mind. Although I have not used my medical insurance yet, I understand I may need it in the future. I choose to be prepared for what lies ahead.
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Deduction U/s 80D for mediclaim premium available to individual HUF and senior citizen
Deduction in respect of Medical Insurance Premium (Mediclaim) paid to keep in force insurance by individual either on his own health or on the health of spouse, dependent parents and children or HUF on the health of any members of the family. A Mediclaim policy is a must because should you fall sick or meet with an accident, your medical bills could wipe out your savings.
HUF(Hindu
undivided Family may be resident or nonresident) :- In case a HUF is taking the deduction, the medical insurance policy can be taken in the name of any member of the family.
Note
Dependent Children (i.e. legitimate or legally adopted children). Children above
18 years, if employed, can not be covered. Male children, if not employed, but a bonafide student can be covered up to age of 25 years. Female children, if not employed, can be covered until the time she is married. 51
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Parents need bot be dependent on the Assesses. Parents of Individual or Spouse both are covered. 3. Entry Age: This insurance is available to a person between the age of 18 to 59years. However, the Policy can be renewed up to the age of 80 years. a) Children above the age of 3 months can be covered provided parents are covered concurrently and suitable premium is paid. If the child above 18 years is employed or if the girl child is married, he or she shall cease to be covered under the policy. However male child can be covered up to the age of 25 years if he is a bonafide r e g u l a r s t u d e n t a n d f u l l y d e p e n d e n t o n p r i m a r y i n s u r e d . F e m a l e c h i l d c a n b e covered up to the time, she is unmarried. b) If the insured has taken continuous Mediclaim insurance policy with us for at l e a s t 5 y e a r s p r i o r t o a t t a i n i n g t h e a g e o f 8 0 y e a r s t h e p o l i c y c a n b e r e n e w e d beyond the age of 80 up to the age of 90 years as a special case with the approval of Regional In charge on case to case basis. The premium chargeable shall be 10%of the premium for 75-80 years age slabs for proposers above 85 and 20% of the premium for 75-80 age slabs for proposers above 90.
c) No inclusion of family member during currency of policy is permissible except for a new born child between the ages of 3 months to 6 months and newly married spouse within 60 days of marriage. Otherwise inclusion of family member shall be allowed only at the time of renewal. Pro rata premium shall be charged for such inclusion during the currency of the policy for the unexpired period. 4. Sum Insured: Minimum sum insured shall be Rs 50,000/- and can be increasedin multiples of Rs 25,000/-upto Rs 5 lacs. The sum insured must be identical for primary insured and the dependents. However, the children may be covered for 50% Sum Insured as per 4 above.
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5. Payment of Mediclaim Premium out of taxable Income:The amount must have been paid using the taxpayers income chargeable to tax. 6. In addition to deduction u/s, 80C, 80CC and 80CCD,:- This is an additional deduction available which do not include deduction u/s80C, 80CCC and 80CCD for which overall limit is Rs. 1,00,000. 7. Partly contribution: If part payment is done by you and part payment by the parent, both can claim deduction to the extent of their contribution subject to maximum allowed but amount should be paid directly to insurance company and paid through mode other than by cash.8. 8. Mode of payment: The premium may be paid by any mode of payment other than cash. Note prior to 1st April 2009, premium payment was required to be done only by cheque. Credit card or other online payment mechanism where not allowed. Now all payment modes except cash payment are accepted.9. 9. Which Mediclaim Premium is allowed? : Mediclaim premium paid under Medical insurance scheme of General Insurance Corporation approved by the Central Government, or any other insurer approved by the Insurance Regulatory &Development Authority (IRDA).10. 10.What is the amount of the deduction?
For Individual
Basic deduction: Mediclaim premium paid for Self, Spouse or dependant children. Maximum deduction Rs 15,000. In case any of the persons specified above is a senior citizen (i.e. 65 years or more as of end of the year) and Mediclaim Insurance premium is paid for such senior citizen, deduction amount is enhanced to Rs. 20,000.
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Additional deduction: Mediclaim premium paid for parents. Maximum deduction Rs 15,000. In case any of the parents covered by the Mediclaim policy is a senior citizen, deduction amount is enhanced to Rs. 20,000.
For HUF
Mediclaim premium paid for any member of the HUF. Maximum deductions 15,000. In case any member of the HUF covered by the Mediclaim policy is a senior citizen, deduction amount is enhanced to Rs. 20,000.Senior citizen: means who is at least of 65 year of age or more at any time during the previous year.
EXAMPLE- 1
1. An individual assesses pays (through any mode other than cash) during the previous year medical insurance premium out of his taxable income, as under: (i) Rs 12,000/- to keep in force an insurance policy on his health and on the health of his wife and dependent children; (ii) Rs 17,000/- to keep in force an insurance policy on the health of his parents. Under the new provisions he will be allowed a deduction of Rs 27,000/-(Rs. 12,000/- + Rs. 15,000/-) if neither of his parents is a senior citizen. However ,if any of his parents is a senior citizen, he will be allowed a deduction of Rs29,000/(Rs.12,000/- + Rs.17,000/). Whether the parents are dependent or not, is not a consideration for deciding the deduction under the new provisions. Further, in the above example, if cost of insurance on the health of the parents is Rs30,000/-, out of which Rs 17,000/- is paid (by any non-cash mode) by the son and Rs 13,000/- by the father ( who is a senior citizen), out of their respective taxable income, the son will get a deduction of Rs 17,000/- ( in addition to the deduction of Rs 12,000/- for the medical insurance on self and family) and the father will get deduction of Rs 13,000/-.
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EXAMPLE 2
An individual assessee pays through credit card during the previous year health insurance premium as under:1.Rs. 12,000 to keep in force an insurance policy on his health and on the health of his wife and children2.Rs. 17,000 to keep in force an insurance policy on the health of his parents. Under the proposed new provisions, he will be allowed a deduction of Rs. 27,000(Rs. 12,000 + Rs. 15,000) if neither of his parents is a senior citizen. However, if any of his parents is a senior citizen, he will be allowed a deduction of Rs. 29,000( R s . 1 2 , 0 0 0 + R s . 1 7 , 0 0 0 ) . W h e t h e r t h e p a r e n t s a r e d e p e n d e n t o r n o t , i s n o t a consideration for deciding the deduction under Section 80D.
EXAMPLE- 3
Question:- In the last budget, the finance minister announced exemptions for Mediclaim charges paid for senior citizens. However, I am not sure if it has yet been notified and effective. I need to take medical insurance for both my parents, who are senior citizens. I would appreciate if you can let me know. Answer:- Earlier Sec 80D deduction in respect of medical insurance premium was Rs 15,000 for an individual and Rs 20,000 for a senior citizen. However, from this year, if someone were to buy medical insurance for his parent/s, an additional deduction of Rs 15,000 (over and above Rs 15,000) will be available. If such parent/s were senior citizen, the additional deduction would be Rs 20,000. So a person insuring himself, his spouse, children and parents could potentially get a deduction of Rs 35,000. This provision is effective from 1.4.08.
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Explanation. For the purposes of this sub-section, senior citizen means an individual resident in India who is of the age of sixty-five years or more at anytime during the relevant previous year. (5) The insurance referred to in this section shall be in accordance with a scheme made in this behalf by (a) the General Insurance Corporation of India formed under section 9 of the General Insurance Business (Nationalization) Act, 1972 (57 of 1972) and approved by the Central Government in this behalf; or (b) any other insurer and approved by the Insurance Regulatory and Development Authority established under sub-section (1) of section 3 of the Insurance Regulatory and Development Authority Act, 1999 (41 of 1999).]
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2. . Expenses incurred at Hospitals/Nursing Homes primarily for Diagnostic, XRays or Laboratory examination, which are not consistent with or incidental to the diagnosis and treatment of the positive existence of any ailment.3. Ambulance charges, registration / admission / file charges, extra food charges, attendant charges etc.
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Q: Does Mediclaim policy cover benefits for treatment taken outside India?
A: No but Mediclaim protection is available for illness / disease / injury contracted anywhere in the World provided the treatment is taken in India.
Q: What happens when I have to undergo a treatment like dialysis and I am discharged on the same day?
A: When treatment such as Dialysis, Chemotherapy, Radiotherapy etc. is taken in the Hospital / Nursing Home and the insured is discharged the same day, the treatment would be considered to be taken under Hospitalization section of the policy and the claim would be admissible.
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5.Maternity expenses incurred in hospital or nursing home as in-patient, subject to the limit specified or Rs. 50,000/- whichever is lower will be paid. This will be given on payment of extra premium and policy being limited to cover maternity benefits. All terms, benefits and conditions of the cover aresubject to the definitions of various terms under the policy.
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of radiotherapy. When I submitted my claim to the Third Party Administrator of New India Assurance Co. Ltd., i.e., Raksha TPA Private Ltd., in February 2005, first they rejected the claim on the grounds that I have claimed for the left breast, which is exclusion in the Policy. This means that they have not scrutinized the claim properly, and the intention was very clear: not to admit the claim. When I wrote to them saying that the claim is not for the left breast, but the right one, now I am given to understand that they are not taking any action, as, according to them, once a person has cancer, then they don't admit any claim for the future, even if it not a recurrence. I have a letter issued by the Chief of Surgical Oncology, Tata Memorial Hospital, clearly saying that this case is a new one and not a recurrence of the old case of 1993. Nobody gives me a proper reply at Raksha TPA, and every time they say that the file is "put up for re-processing," but nothingis happening. This seems just harassing the policyholder with no intention of settling the claim. Since I have three letters (two from Oncology Consultants in UAE stating that she was free of any Detectable disease as far back as 1998, and the letter from Chief of Surgery of Tata Memorial Hospital, stating that this case isa new one and not a recurrence of the old case), I feel that Raksha TPA may not beright in rejecting my claim. I shall be thankful to have your advice on how I should proceed, in getting my claim admitted and settled. Regards, K. S. Subramanyam Response by the company In cases of cancer the chances of recurrence is 8% to10% higher but while taking the policy, only cancer of left breast was excluded. Moreover, the doctor at Tata Memorial Hospital has certified that right breast cancer was a fresh case of cancer, hence we grant their claim of Rs 80,000.
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MEDICLAIM INSURANCE
Hypertension since the year 2000, which is specifically excluded under policy terms. Consumer Forum judgment: It cannot be said if the complainant was suffering from Hypertension nor can it be said that he concealed the disease at the time of purchasing the policy. Needless to mention that CAD is totally di fferent disease than hypertension. The claim for CAD therefore cannot be repudiated on the ground that the complainant was suffering from Hypertension. We appreciate this judgment as it has been customary for the insurance companies to reject the claim on the basis by taking the lea of hypertension.
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CONCLUSION
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