How to Avoid the Risk of Being Underinsured by Your Health Cover?

 How to Avoid the Risk of Being Underinsured by Your Health Cover?

You must have heard countless times that you need to have health insurance. However, do you know how health insurance financially covers you against illnesses? The idea of health insurance is that if you fall sick and need to be hospitalized, the medical bills of your treatment will be covered by the insurance provider. However, the coverage of health insurance is not unlimited. For the premium you pay, you buy a fixed amount of coverage. Hence, what happens if your medical bills exceed your health insurance coverage. Simple; You have to cover the rest by yourself. Therefore, it is essential to have enough coverage in your health insurance plans.


While the number of people buying insurance is on the rise, underinsurance is a problem growing at a similar rate in the country. Inaccurate information or the lack of knowledge can have you thinking that you have insurance and are protected against medical emergencies. However, when they claim and realize that their medical expenses are much higher, it leaves them in a challenging financial situation.

How can you be underinsured?

Being underinsured is not having enough coverage for yourself or your family. However, there are different ways of being underinsured. This only means that you would have to be more varied in your medical needs and buying coverage. Here are two ways you can be underinsured:

  • Low sum insured

Sum insured is a significant factor when buying health insurance. It is essentially the maximum amount the insurance company would pay for your medical treatments. It is connected to the premium you would have to pay for the policy. Hence, many people choose to lower their premium by going for a lower sum insured. They think that they have enough coverage for a lower price. However, if the medical emergency turns out to be a lengthy one at the time of claim, you would have to cover the excess amount of the medical bill by yourself.

  • Low scope of coverage

In this case, the fault is not with the amount of coverage but the specific inclusions and exclusions of the coverage. It is the question of whether your insurance provider would cover a certain illness, certain procedures, or certain facilities when you are hospitalized. This way of being underinsured has less to do with you and more to do with the policy that your insurance provider offers. This means that if you select a policy with this insurance provider, you would have to compromise on not having this coverage at all. If you are ever caught in this particular set of situations, you would have to cover its expense on your own. This can include coverage for critical illnesses like cancer, capping on room rent in hospitals, coverage for dental procedures, etc. * Standard T&C Apply

How can you avoid being underinsured?

The best way to avoid being stuck in a weird situation is to think ahead before buying the policy. This means evaluating every way that you could end up being underinsured. Then, you have to take viable measures that get you enough coverage without hurting your budget. Here are a few tips you can follow:

  • Assess your coverage needs when purchasing the policy. Take factors like inflation and possible unforeseen medical expenses into account.
  • Select an adequate amount as the sum insured. Ideally, you should go for a sum insured higher than what you think you might need. But, take your affordability into account as well. Read thoroughly through the inclusions and exclusions of the policy. Ensure that all types of coverage that you want in the tour policy are available and included.
  • You can use top-up health insurance plans that enhance your existing health insurance cover.
  • In some extreme cases, the health insurance portability facility allows you to change your insurance company to a better provider.

Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.

Dennis Bailey

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