Health Insurance Glossary (2) -INDIA - continued

Disability Insurance

Disability insurance is a form of insurance that pays a monthly income to the insured when he suffers from total or partial disability. This disability could have been caused due to either illness or injury,   but affects his capacity to work and consequently earn.  

Domiciliary Hospitalization

Domiciliary Hospitalization is the treatment of the patient is carried out at home. This needs to be as  per the doctor's recommendation. Most health insurance companies do cover domiciliary hospitalization subject to  a certain limit depending on the sum insured.

Exclusions

Exclusions are diseases and conditions for which medical expenses are not covered by the health insurance policy. Exclusions can be of two types – Permanent and First year. Permanent exclusions are never ever covered by the policy for example,AIDS or expenses incurred on cosmetic surgery.

First Year exclusions are ailments which are not covered for the first year of health insurance cover, but are covered subsequently for example surgery for cataract is usually not covered in the first year but is covered starting the second year.

Floater Policy

A floater policy is issued with a single sum insured covering number of individuals. Simply put, it is a one premium and one policy for all members of the family. The cover can be used any member of the family any number of times.

For example, there are four members in your family- you, your spouse and  your two children. You purchase a family floater policy with a sum insured of Rs 500,000. This means that if you fall sick and utilize Rs 200,000 in treatment- the balance Rs. 300,000 can be utilized by any member of the family including yourself. Your total expenses across the family would however be capped at Rs. 500,000.

Good Faith

Good Faith is a minimum standard to get into a contractual arrangement. It requires both the buyer and seller in a transaction to act honestly toward each other and to not mislead or refrain from providing critical information to the other party. In the context of health insurance in India, it requires you to disclose all relevant personal information like previous disease history to the insurer before buying insurance.

Group Insurance

A firm or an association may buy a policy to insure members of a group. For example a Company may take a policy to cover a large group of its employees.