Health Insurance Glossary – A to Z Health Insurance Terms You Should Know

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A to Z Glossary  of Frequently Used Terms in Health Insurance Policy

When it comes to reading a health insurance glossary fully, it is quite likely for a layperson to not be able to comprehend it – sometimes completely or even not at all! This blog aims at familiarizing you with the basic jargon used in nearly all health insurance plans to help you make informed decisions each time you go over them.

Your health insurance policy is your eternal guide to health security for your future as well as that of your family. It therefore becomes vital for you to read it at least once thoroughly so that you know what it exactly contains and how it is useful for you.

However, since most people like you and me are not generally aware about the technical jargon used in health insurance plans, it becomes difficult to fully comprehend the document. Note that it is not really necessary to be able to understand the meaning of each and every term specified in your insurance policy. However, it always helps to know what those words stand for or imply so that you can stay informed.

This is why we enlist in this blog a glossary of the most commonly used terminologies in a health insurance policy. These are also arranged from A-Z for your convenience. Keep reading to know what each of them means.

A-Z Health Insurance Glossary of Terms Everyone Should Know 

  1. Add-on Cover: A very commonly used term in almost all health insurance policies, add-on cover refers to an additional feature that is optional for the policyholder to choose/buy separately with the basic plan. It offers extra coverage over and above the one provided in the base plan and hence needs to be bought at an additional payment.
  2. Beneficiary: This refers to the nominee selected by the policyholder who would be entitled to receive monetary benefits on behalf of the latter, in case he/she passes away during the term of the plan.
  3. Critical Illness Insurance: Additional coverage provided in your plan for severe health conditions such as cancer, strokes, heart attacks, and the like. Insurance can be bought to cover medical expenses incurred on the treatment of serious illnesses of this order.
  4. Domiciliary Hospitalization: This means that the policyholder is unable to receive treatment at the hospital and can therefore avail medical treatment from their home under professional guidance from medical staff.
  5. Exclusions: These indicate the various health conditions or ailments not covered under your health insurance plan. It is very important to read all the exclusions mentioned in your policy document before proceeding with its purchase to avoid any confusion later at the time of making an insurance claim.
  6. Free Look Period: This is a small service provided by the insurer to the insured, allowing them to cancel the health insurance plan bought without the imposition of a penalty, Note that it is generally a limited period (no-penalty period), maybe lasting up to 15 days.
  7. Group Health Insurance: This is a type of health insurance plan that can be bought for a group of people together. This is generally done in case of a set of employees working for the same company. The employer incurs the premium for the plan and offers its benefits to the employees in return for their service to the company.
  8. Hospitalization: This refers to staying in the hospital upon admission for a minimum of 24 hours. It can apply both in case of planned stay for treatment or unexpected admission in case of emergency.
  9. IRDAI: It is a common acronym used for the Insurance Regulatory and Development Authority of India. It is the highest body in the insurance industry that governs and regulates the working of all insurance companies.
  10. Lapse: Lapse is when the coverage provided by the insurer under a specific health insurance policy has either expired upon expiry of policy term, or been terminated by the insurance company due to failure in premium payment on part of the insured.
  11. Maternity Insurance: This is provided to the insured to cover all costs incurred during the birth of a child. Both normal and C-Section deliveries are covered under maternity insurance along with expenses involved in pre- and post-natal care as well.
  12. Network Hospitals: Your insurer would provide you with a list of network hospitals at the time of policy purchase which includes the names of the hospitals that have a tie-up with the insurance company. These hospitals offer the benefit of cashless hospitalization (treatment without spending any money to the hospital) to the insured since they are empaneled with the insurer.
  13. OPD: OPD is a common abbreviated form for Out Patient Department and you would find the term OPD treatment mentioned in your health insurance policy document often. It simply refers to the treatment availed at a nearby clinic or hospital without the need for getting admitted at the facility.
  14. Pre-Existing Disease: This refers to any health condition or disease that the policyholder may have had at the time of buying the insurance plan. Ideally, the insurance company must be informed of it before proceeding with purchasing insurance.
  15.  Restoration Benefit: This is an exclusive benefit offered to the insured wherein the insurance company agrees to refill or recharge the amount of sum insured to the policyholder in case the sum is used up or exhausted. This may happen at the time of availing a major treatment for a serious health condition that involves huge expenditure. Upon exhaustion of the sum insured in this case, the insurer may refill that amount to be used the next time for another treatment for the insured.
  16. Senior Citizen Plan: There are some health insurance policies specifically designed for the elderly population of the country. The Senior Citizen Plan ideally covers people aged between 60 and 70 years. Some of the healthcare benefits covered under the plan include AYUSH coverage (for alternative treatments like Ayurveda, homeopathy, naturopathy, and the like), cost coverage for psychiatric treatment, and cover for domiciliary care.
  17. Top-up Cover: These are plans that can be purchased over and above the standard health insurance plan. The top-up cover helps cover the healthcare costs upon exhaustion of the sum insured amount covered under the standard policy.
  18. Waiting Period: This refers to the time period that the policyholder needs to wait before raising a claim with the insurer. The only exception is made in the case of an accident wherein no waiting period rule applies. This period is generally for 30 days; however, it may be up to 4 years in case the insured has pre-existing diseases.

To Conclude

This list may not contain a comprehensive health insurance glossary and medical terms since there are several other terminologies that we could not cover here. However, we hope this gives you a fair idea of some of the most commonly used terms used in health insurance policy documents. To look for the best health insurance company in India, always do a thorough research and check for customer reviews online.

Found this post informational? Browse PayBima Blogs to read interesting posts related to Health Insurance, Car Insurance, Bike Insurance, Term Life Insurance and Investment section. You can visit PayBima to Buy Insurance Online.

Aug 26, 2022
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PayBima Team
PayBima is an Indian insurance aggregator on a mission to make insurance simple for people. PayBima is the Digital arm of the already established and trusted Mahindra Insurance Brokers Ltd., a reputed name in the insurance broking industry with 17 years of experience. PayBima promises you the easy-to-access online platform to buy insurance policies, and also extend their unrelented assistance with all your policy related queries and services.

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