Hi Adhil. With the rising numbers of Covid-19 cases, I’m planning to purchase a Covid Rakshak policy. What all should I keep in mind before finalising my move? – Vishwaroop
Ans: Hi, there. Covid Rakshak along with Covid Kavach are the two Covid-specific short-term health insurance plans launched by several insurers in the country. But unlike Kavach plans, insurers are not mandated to launch Rakshak policies by the IRDAI. That said, many insurers have already launched both policies. Here are a few critical things to consider before buying a Covid Rakshak policy:
1. Covid Rakshak plans are benefit-based insurance policies meant for income replacement, unlike Kavach plans, that are indemnity-based plans. If the insured is diagnosed Covid positive and require continuous hospitalization at a government-authorized hospital for over 72 hours, he will get the complete sum insured under his Rakshak plan irrespective of the actual cost of treatment.
2. Covid Rakshak plans offer three policy tenures of 105 days, 195 days and 285 days and adults between the ages of 18 to 65 years can buy a policy with a sum insured anywhere between Rs. 50,000 to Rs. 2.5 lakh in multiples of Rs. 50,000.
3. The actual premium amount applicable to you would depend on your chosen insurer, the sum insured, tenure, age, pre-existing conditions, etc.
4. There’s a waiting period of 15 days to make a claim against the Rakshak policy. Also, this plan cannot be renewed.
5. Covid Rakshak plans can only be purchased on an individual basis and not on a family floater basis.
6. An insurer might reject a claim if the insured has travelled to a restricted country or has been diagnosed at an unauthorized testing centre or outside India.
So, you’ll be well-advised to compare the Covid Rakshak plans offered by different insurers and choose the one that best suits your requirements. And if you’re the sole breadwinner of the family, you might want to get a plan with a high sum insured as this would work as an income replacement if you, unfortunately, get infected by the feared virus and require long-term treatment at a hospital. However, if you don’t have any medical insurance plan, you should prioritize getting a comprehensive policy for yourself and your dependent family members to cover for steep hospitalization bills.
Have a question on personal finance? Ping me on Twitter at @adhilshetty with the hashtag #AskAdhil. The writer is CEO, BankBazaar.com, an online marketplace for loans and credit cards.
Need help in calculating your EMI? Use BankBazaar’s easy Personal Loan EMI calculator.