Is Arogya Sanjeevani Health Insurance Policy Made For You

IRDAI has mandated all general and health insurance companies to make available Arogya Sanjeevani policy from April 1, 2020. It is a standard health insurance policy for both individuals and families. It provides a coverage of up to Rs. 5 lakh against basic hospitalisation-related expenses. Again, to make the basic product simpler to understand, IRDAI has banned insurance companies from offering riders and variants or imposing deductibles with the policy.

So, is Arogya Sanjeevani policy formulated for you?

While some finance experts believe that Arogya Sanjeevani policy is a good entry-level product, others believe that an insurance coverage of up to Rs. 5 lakh isn’t sufficient for covering a family of four.

The policy is a basic simple health insurance policy. It is highly affordable as you get a sum insured only up to Rs. 5 lakh. Again, Arogya Sanjeevani policy does not have features of a fully loaded comprehensive health policy. For example, it has a co-payment feature of 5 percent. A standard comprehensive health insurance policy won’t have such obligations.

Nevertheless, IRDAI has also announced a 5 percent increase in the sum insured for each claim-free year under Arogya Sanjeevani policy. The increase is subject to a maximum of 50 percent of the sum assured provided that the policy is renewed without any halt.

You should consider buying Arogya Sanjeevani policy if

Arogya Sanjeevani policy is suitable for first-time health insurance buyers. This is because the product offers a wide coverage at an extremely affordable premium. Again, the cover and terms and conditions of the policy are standard across all insurers making it easier for you to understand the policy. So, if you are a first-time policy buyer with a limited budget, Arogya Sanjeevani policy is a good fit for you.

Even when the awareness about the need for health insurance is rising in India, its penetration is still very low in our country. The primary reason for its low penetration is the clutter and complexity associated with health insurance policies. Also, one other reason is its unaffordability due to high premiums. These reasons have deterred average Indian households from buying health insurance. This is something that the Arogya Sanjeevani Policy addresses. The policy is simple and standard in its construct and has a reasonable premium structure.

So, if you are an individual with no dependents, you should consider buying this policy. The policy is beneficial for the youth of India who are looking for individual comprehensive cover for themselves. Its premium is lower and it has a wide coverage that even includes day procedures.

You should not consider buying Arogya Sanjeevani policy if

The cost of healthcare is high and rising. A cover of Rs. 5 lakh might not be adequate, for someone living in tier-1 or tier-2 cities. If you live in a big city and are someone with the capacity to pay high premiums, you should go for a cover more comprehensive and big than the Arogya Sanjeevani Policy to get adequate health cover.

You can go for health insurance plans in India with a higher sum insured. You must consult a financial planning advisor before buying a policy.

Again, if you have dependents, then consider buying a family floater health insurance plan in India. If you have dependents such as children or parents, a higher cover is very important for you. Also, you must choose your policy as required based on coverage and inclusions. An upper limit of Rs. 5 lakh in Arogya Sanjeevani policy would not suffice for families. If you already have a sufficient base health cover, you can consider buying a super top-up health plan.

Insurance experts suggest that super top-up health insurance plans are designed to enhance the health insurance coverage of an existing health insurance plan. It acts as a supplement to your base plan and can pay for multiple bill claims. Also, buying another comprehensive health insurance policy with a higher sum assured is expensive. A super top-up plan is a regular indemnity-based plan that can be annually renewed. However, note that a super top-up comes into play only when the deductible limit is crossed.

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