Health Insurance Policy has become a need of the hour due to the high cost of medical treatment and often unaffordable medical expenses. While it is crucial to have a health insurance policy that covers any unexpected medical emergency, it is also important to properly understand the terms and conditions and jargon related to the insurance. Confusion may result in you failing to take full advantage of the insurance coverage. One thing that you should be well versed in is the sub-limit.
A sub-limit is a cap on how much insurance is covered by a policy. This cap is stated in the policy as a fixed cash amount. There are sub-limits for several conditions, medications, and services. The sub-limit is sometimes expressed as a percentage of the sum assured and other times as a fixed sum.
Let’s say your policy’s sum covered is Rs 5 lakh. However, the policy has maintained a lower limit for the treatment of any illness. If the sub limit is Rs. 50,000 and your medical expenses have increased to Rs. 100,000, In this case, the insurance provider will only contribute Rs. 50,000. Reason? The provider had already mentioned the sublimit to treat that sickness in the policy. Now, even though your policy’s sum assured is Rs. 5 lakh, you will still need to pay the remaining Rs. 50,000 out of your pocket.
Insurance companies keep sub limits not only on ailments but also on some services. Usually, it is applicable on many services, including hospital room rent, ICU charges, ambulance fees or OPD. For example, the insurance company can keep a condition on the rent of the hospital room keeping the sub-limit at Rs 3000 per day. If your hospital room rent is Rs 5000 per day, the extra Rs 2000 per day expense is yours alone.
The sub limit can also be in percentage of the sum assured. Suppose your sum insured is Rs.5 lakh and the room rent sub limit is 2% of the sum insured, then you can claim up to Rs.10,000 as room rent.
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