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Sample this: The 70-year-old Ravikant was anxious about his medical bills, a massive Rs 35,00,000. He regretted not buying a solid health insurance policy when he was young. Now, at his age, he was ineligible for a regular policy. He was living off borrowing from his relatives when someone told him about insurance policies specially designed for the elderly. He wondered if he could sign up for it, and whether or not it would benefit him? Let’s understand.

While this insurance would do nothing for Ravikant existing bills, it might take some financial pressure off his future medical bills. According to a report by the Ministry of Health and Family Welfare, only 5.2% of surveyed individuals aged 60+ had insurance coverage to cover all their out-patient and in-patient hospital bills in 2017-18. 

Outpatient bills are incurred when the patient is not admitted in hospital and simply takes medical consultations. On the other hand, in-patient bills are generated when the patient is admitted in the hospital for more than 24 hours.

Insurers are now introducing specific health insurance policies for the elderly, where the entry or minimum age is 60 years. While these are majorly aimed at those who do not have any existing health cover, they are not devoid of issues. 

As per the Ministry of Health and Family Welfare report, 34.6% of people aged 60 and above are ailing from cardiovascular diseases, while 32% have hypertension or high blood pressure. 18.8% elderly noted having some kind of bone or joint ailments. A staggering 55.3% were suffering from vision related conditions like cataract, glaucoma and others. About 43.3% of individuals relied on some kind of aid or supporting devices in their day to day lives. 

These conditions take a far heavier toll on pockets than bodies. But if you think insurance policies designed for the aged would offer undivided and unconditional financial coverage for such conditions, think again. Most policies impose sub-limits, waiting periods and co-payment clauses for their treatment, along with extremely high premiums. 

For instance, consider the Star health senior citizens red carpet health insurance policy, which offers sum insured between Rs 1,00,000 to Rs 7,50,000. The policy does not include dental or hearing aids, other prosthetics etc. . It also imposes a 30% copayment condition for all claims. 

Take the recently launched Tata AIG Elder Care plan. If, like Ravikant, you’re a metro resident seeking a sum insured of Rs 25 lakh, be ready to cough up an annual  premium of Rs 64,210. This can touch Rs 90,035/year for those aged 71-75 years, and Rs 1,33,729 for those between 76-80 years. 

Moreover, for every claim worth Rs 1,000 made under this policy, the insurer will only pay Rs 800 i.e. there is a 20% co-payment compulsion in this policy. 

Insurers also impose an additional cost to your premium payable if they feel you’re a risky individual or prone to making frequent claims. And often, these additional costs can vastly exceed the actual premium, like for TATA AIG, where the risk loading can go as high as 100% of each claim. 

Retirement advisor Sanjeev Dawar says that unlike life insurance, the premium for health insurance increases periodically and in direct proportion to an individual’s age band. At times, even a good amount of cover may turn nominal after a few years due to high medical inflation. It is advisable to buy a comprehensive health insurance plan early on in life, so that premium costs do not eat onto your overall finances. At the same time,  it’s also important to maintain a health fund to meet expenses which are either denied or partially covered by policy