RESTORE BENEFITS IN HEALTH INSURANCE

Restore benefits in health insurance means reinstating the insurance claim amount in a calendar year after the policy amount being exhausted due to hospitalization expense. 

Besides helping you meet the medical expense, purchasing health insurance can also qualify all the premium payers to get income tax benefits under section 80D of the Income Tax Act.  

What is Restoration? 

A restoration benefit plan is basically an add-on to your health insurance policy. It comes at a nominal cost which is added on and above your policy premium, while in other insurance plans, it comes as a built-in benefit.

With restoration benefit, you can rest assured that you will not face hassle should you run out of coverage amount for a particular premium year. Instead of plunging to withdraw your savings, you can opt to let the restore benefits of health insurance take care of you. 

Many of the benefits offered are the same in all the cases. However, some insurers are better as they offer added convenience and advantage as compared to others. 

Why do you need Restore Benefits? 

You need restoration benefits for the following reasons: 

•  Restore health insurance benefits will let you enjoy an additional coverage limit, even if you completely exhaust the available amount. 
• You will get better peace of mind as you will not run short of funds should you get hospitalized even after draining the insured amount. 
• If you have a family floater plan, these benefits will secure your entire family provided you have enough insurance limit. It offers an automatic restoration of the sum insured after the policy claim amount is reached. 
• In times of emergency, you will never fall short on resources when you need them the most. 

Types of Restore Benefits

There are two basic types of restoration benefits. They are divided into two major divisions: 

Partial Exhaust Benefits: In this type of benefit, you are entitled to getting your policy amount restored on expending the original plan amount partially. 

For instance, you have health insurance of 6 lac per annum, you spend 4 lacs on hospital bills, and you have 2 lacs left. Your policy entitles you to get a reinstation of the full amount after you have exhausted it even partially. 

Complete Exhaust Benefits: In this case, your restoration benefits only apply when you have completely exhausted the insured amount available to you. 

For instance, if your insurance is 6 lac per annum and you expend 4 lacs, you will not get restoration benefits in this case. Your claim shall only be valid when you have exhausted 6 lacs completely. 

How to Pick a Restoration Benefit Plan? 

Health insurance is surely the most important thing, given the pandemic situation where hospitalization can be required at any point. Hence, you should know which things to know before picking a health insurance with restore benefits.

Availability in the Insurance: In many cases, this benefit comes as a built-in advantage to the policy. Check whether your policy already covers this benefit or not. If it does not, then you can add the restoration benefit to your coverage plan in the form of add-on terms at an additional cost. 

Restoration Limit: Checking the extent and the limit of restoration is immensely important. For instance, if you have a coverage of 6 lac, and the restoration limit is 50%, then upon exhaustion, the insurer would reinstate 3 lacs. If your restoration extent is 100%, then the insurer would give you an additional amount of 6 lac more upon the exhausting your policy amount. In case the restore extent is 200%, you would get another 12 lacs after the consumption of 6 lac. 

So, the total coverage of your health insurance stands 9 lacs in the first case, 12 lacs in the second case, and 18 lacs in the third case.  

Cost of Coverage: Plans that have in-built or added-on restore benefits would cost you more than policies that don't. The cost of the plan varies from insurer to insurer. 

Essential Facts about Restoration Benefits

Restoration benefits will help you immensely in such a crisis pandemic situation to help cover the cost of hospital bills. But there are some important things you should know first: 

• The restoration sum you claimed in a policy year cannot be carried to the next policy year, even if you do not claim it. 

• The insurer will only reinstate on complete or partial exhaustion of the original policy plan amount. 

• You cannot claim a restoration benefit in your first claim of health insurance. This means that this benefit will only be triggered on the second claim. However, in cases of accidents, there might be exceptions. 

• The restored benefits will not come into play in case of related ailments. For instance, you consumed the policy amount on heart disease. You might not be able to claim the restoration benefits for the same ailment in that particular policy year. 

FAQs

How many times are restoration benefits triggered per policy year?

Restore claim triggered only once per policy year and can't be carried to the next year. 

Can I claim restoration benefits for the same ailment? 

If you have used your original policy claim amount on a particular ailment, then the insurance restore benefits will restrict you from using the reimbursed benefits for the same health problem for one particular policy year. 

Can I avail the restoration benefits in the first claim? 

The name suggests that it ''restores'', which means you will not be able to claim the restored benefits in your first claim. However, some insurers will let you avail the restore benefits in case of accidents. 

In the case of family floater plans, can two family members claim to restore benefits at a time? 

In case of multiple claims in a family floater plan, the policy amount will be split among the different family members.