Regular Top-up and Super Top-up Health Plans: How to Choose between Them?

Regular Top-up and Super Top-up Health Plans: How to Choose Between Them?

Top-up health insurance plans are used to augment the coverage of your regular health insurance plan. The top-up plan gets activated if your hospitalization expenses cross a threshold limit, known as the deductible. 

What do you mean by deductible?

A deductible is a part of a claim that you, as a policyholder, need to pay from your pocket. Your insurer will pay only that part of the claim that exceeds the deductible. 

Suppose you have a health insurance plan with Rs.2 lakh deductible. And your claim amount is Rs.4.5 lakh. Here, your insurer will pay only Rs.2.5 lakh. You must pay the deductible (Rs.2 lakh) from your pocket. On the other hand, if your hospital bill is Rs.5,000, your insurer won’t pay any amount. As the bill amount is within the deductible, you can’t raise a claim, and you’re liable to pay the entire amount. 

Insurance companies use this mechanism to avoid small and unnecessary claims. Different health insurance plans have different deductibles.

Usually, health insurance plans with a deductible have a lower premium than those without it. The higher the deductible, the lower the premium. Hence, in the long haul, you can save a handsome amount.

In the case of top-up health insurance plans, the deductible of your top-up plan should not exceed the sum insured of the base policy.

Regular top-up vs. super top-up

Regular top-up plans and super top-up plans are the two types of top-up health insurance plans.

A regular top-up plan works on a per claim basis, i.e., the regular top-up plan will cover the healthcare cost if the amount of each claim goes beyond the deductible. In contrast, a super top-up health insurance plan works on a yearly basis, i.e., it takes the cumulative hospitalization expenses of a health insurance plan in a year and applies the deductible to the entire amount.

Which is the better option: super top-up or regular top-up?

If your health condition demands frequent hospitalization, you should go for a super top-up plan. Super top-up plan with cumulative cover suits the best for the geriatrics who require frequent hospitalization and need to undergo several medical procedures in a year. The below example makes it more lucid.

Particular Regular Top-up Plan Super Top-up Plan
Sum Insured Rs. 5 lakh Rs.5 lakh
Deductible  Rs.1 Lakh Rs.1 Lakh
Claim No.1
Claim Amount Rs. 2 lakh Rs. 2 lakh
Policyholder Pays Rs.1 lakh Rs.1 lakh
Cover by the Insurer Rs.1 lakh Rs. 1 lakh
Claim No.2
Claim Amount Rs.3 lakh Rs.3 lakh
Policyholder Pays Rs. 1 lakh Rs.0
Cover by the Insurer Rs.2 lakh Rs.3 lakh
Claim No.3
Claim Amount Rs.75,000 Rs.75,000
Policyholder Pays Rs.75,000 Rs.0
Cover by the Insurer Rs.0 Rs.75,000

Suppose in a particular year you make three claims. The first one is of Rs.2 lakh, and the second one is of Rs.3 lakh and the third one is of Rs.75,000. In the first claim, the sum covered by the insurer is the same in both regular top-up and super top-up. But when you make the second claim in the same year, the deductible won’t be applied to the claim in super top-up, as you’ve already paid in the first one. While in the case of a regular top-up, the deductible is applicable each time you make a claim. In the third claim, your insurer will not pay any amount in the regular top-up plan as the claim is below the deductible. While in the super top-up plan, your insurer will pay the entire amount as the deductible has already been applied once in that particular year.

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