Restoration Benefits vs. Super Top-Up Plan

4 min read

Usually, insurance providers provide restoration and top-up features as part of your medical insurance coverage, albeit they may incur an extra premium. Both restoration and top-up solutions each have their own set of advantages. Which of these is perfectly suited for you? Let’s dive in.

What are Restoration Benefits in Insurance Policy?

If an insured elects the restoration feature, the insurance company replaces the amount guaranteed if it is depleted within the plan year. As a result, if you have spent up the whole amount promised in a year, the plan provides insurance coverage.

For instance, if a customer has a 7,00,000 INR mediclaim insurance and uses it up – let’s say, on COVID-19 treatment expenditures, he or she is not eligible to file an additional claim for the remainder of the plan year if he or she becomes ill again. Nevertheless, if the plan includes a restoration feature, the insured can receive an additional 7,00,000 INR as the amount insured in that year and submit another claim for up to 7,00,000 INR within the year if he or she is hospitalized again.

Of course, depending on your insurance provider and plan, you may be charged an extra fee for this service. The extra sum you may claim is determined by the insurance policy sum you chose, your age, the type of coverage you have, your healthcare history, and other factors. Furthermore, the payout may be subject to further requirements. Once the total sum insured is depleted, the balance is generally replaced.

When is Restoration Benefit useful?

In single-family floater insurance, the restoration feature is quite beneficial. Even if a single member of the household consumes the full sum insured, the remaining members will still be protected. There may be limitations connected, like the restoration advantage not being offered to the same individual again in that same year, but being accessible to other plan beneficiaries. It is also possible that the same person may be unable to utilize the restored amount promised for a linked ailment but will be able to claim for another unrelated illness. There could also be timing constraints or gaps between claims throughout that year.

What is a Super Top-Up Health Insurance Plan?

A super top-up insurance function as a fallback plan that kicks in if the amount promised in your medical insurance plan has been depleted. These policies are less expensive than traditional medical insurance policies, but they have a deductible level and will only reimburse bills over that amount.

Let’s say you own a 5,00,000 INR baseline health insurance plan and a 15,00,000 INR super top-up plan with a 5,00,000 INR as deductible. Suppose you file 3 claims in this instance, for 2,00,000 INR, 4,00,000 INR, and 6,00,000 INR, respectively. So, on your first claim, you will receive the entire amount of 2,00,000 INR from your base health insurance plan.

For the second claim, you would receive 3,00,000 INR from your base plan and the remaining 1,00,000 INR would be paid from your super top up plan. The 3rd claim would be entirely paid from your Super Top Up plan.

When is Super Top-Up Plans useful?

Conventional mediclaim insurance allows you to claim healthcare fees up to the amount covered, whereas a super top-up cover offers expenses above a particular threshold.

Super Top-up medical insurance policies are compensation plans that offer the same advantages as standard reimbursement policies. The sole distinction is that these policies have higher deductibles, which make them less expensive. A super top up plan considers an aggregate of the claims to calculate the deductible amount applicable in a given policy year, unlike a top up plan, where a claim is triggered only if each claim is more than the deductible amount. This makes Super Top Up plans more expensive than its top up variant but definitely worth the amount. The premium is cheaper when the deductible is higher.

Tip: The deductible of a Super Top Up Plan should ideally be the same as the base plan coverage amount and both plans need to be taken approximately on the same date, for maximum efficiency.

It should be emphasized that a restoration feature cannot be obtained without first acquiring basic medical insurance coverage. You may, however, obtain a top-up policy without purchasing basic medical insurance coverage. The policyholder must bear the first expenditures up to the given deductible limit. The insurance provider will bear the remaining expenditures over the deductible sum. It works effectively in the event of large-amount claims.

Conclusion

When comparing health insurance policies and selecting a plan with a restoration or super top-up option, you should thoroughly comprehend the add-ons and other restrictions. Restoration, as well as super top-up services, have their very own set of benefits. Before selecting medical insurance, make sure you understand everything that is included, what is not protected and the claim requirements.

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Gayatri Prabhu, Head-Digital Business at Mahindra Insurance Brokers Limited (MIBL) is one those few digital leaders who has the width and depth that is required to execute an ROI driven holistic digital strategy. She cuts through the noise, identifies the critical levers and leads her team to successful execution of the defined strategy. Her core mantra to win new and retain existing customers is: understand the consumer behavior and craft experiences around it.

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