Can a top-up plan for pre-existing well being points assist?

I’ve a floater well being coverage of ₹5 lakh and I’ve been renewing it for the final 4 years. I’ve some well being points and want to know if I can take a top-up plan any time or solely have the ability to improve the sum insured solely on the renewal of my coverage. Also, if I purchase a top-up plan, can I take advantage of it for pre-existing medical circumstances together with my common coverage?

—Name withheld on request

A top-up plan works unbiased of the bottom plan. It needn’t be concurrent with the bottom plan renewal date. So, you should buy a top-up plan anytime.

Whenever you improve your sum assured or purchase a brand new plan, ready interval on the brand new sum assured is relevant from the date of buy. Generally, top-up plans have a ready interval for pre-existing illnesses of between 2 to 4 years. So, should you purchase a top-up plan immediately, you’ll have the ability to make a declare for pre-existing illnesses solely after this ready interval for pre-existing illnesses is over. Do just be sure you precisely disclose your well being situation whereas shopping for the top-up.

My automotive is 5 years outdated and I’ve by no means made any claims on the automotive insurance coverage in these 5 years. However, I’ve seen that yearly, the premium on the coverage will increase barely. I’ve been shopping for the coverage from the identical insurer all these years however the premium continues to rise regardless of this. Do let me know the explanation for this.

—Name withheld on request

Car insurance coverage premium is a operate of two sections i.e., personal injury and third-party premium. You ought to assess the change in premium in each sections individually. The personal injury part offers protection for loss to your automotive in case of an accident or theft. The third-party part offers protection for any authorized legal responsibility on you on account of private or property loss induced to another person by your automotive’s accident e.g., demise or damage of a pedestrian. 

By regulation, third get together legal responsibility is obligatory to purchase. The premium is mounted throughout a class of autos, and isn’t dependents on a person’s declare historical past. Over the previous few years, the third-party premium has been on the rise. Own injury premium relies on the Insured Declared Value (IDV) of the automotive, no-claim bonus (NCB) and the low cost supplied by the insurer. 

First, IDV is the sum assured of the personal injury part. Lower the IDV, decrease can be the premium. Each yr, the IDV of the automotive comes down on account of depreciation. The second issue is the NCB. Since you haven’t made any declare, your no-claim bonus can be rising or stay intact annually. This retains your premium both fixed or brings it decrease. Finally, the low cost supplied by the insurer adjustments yearly. This low cost is utilized on the usual tariff expenses. 

Insurers supply decrease low cost on older automobiles. However, given the opposite two elements, your premium shouldn’t be rising yearly on this part. If that is so, you must consider different insurers, who might supply higher reductions and assist decrease your premium.

Abhishek Bondia is principal officer and managing director, SecureNow.in.

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