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Health Insurance

Post By Varghese

Recharge Benefit in Health Insurance

• Comments
• 18 Jun 2016
• Health Insurance

As consumers, we always seek to derive more out of the products and services that we purchase. A Recharge Benefit offered under a Health insurance plan is one such product that offers you an additional Sum Insured, at no extra cost. Sounds interesting, isn’t it?

So let’s understand what exactly a Recharge Benefit is and how does it work. Suppose you have a sum insured of 3 Lacs which you has completely exhausted during a recent hospitalization. With the Recharge Benefit, your entire sum insured (100%) will be automatically reinstated, to be used for a future claim, in the same policy year. While in a Standard Health Insurance Policy, if you exhaust your entire sum insured, you would have to wait until the next policy year to use your cover. So basically, a Recharge Benefit not only saves money but also saves time, as you don’t have to worry about delaying your treatment until the next policy year.

Now, if you are wondering whether a plan with Recharge Benefit will be expensive as compared to a Standard Health Insurance Plan, then let me clear your doubts. Yeah, a Recharge Benefit would definitely cost you more than a standard Health Insurance Plan as nothing comes for free. However, if you compare the advantages of Recharge Benefit, you would realize that you are getting a dual cover by paying just a little extra. For e.g. a Standard Health Insurance Plan for a 30-year-old would cost approximately Rs. 6,000/- Annually, while a plan with Recharge Benefit would cost around Rs. 7,000/- Annually. So you are just paying Rs. 1,000 extra for a dual cover.

You must be wondering how can the insurers afford to offer dual cover at such a low price. These benefits come with certain conditions that you need to fulfill in order to use the recharged amount. These two conditions are almost standard in all the policies.

1)    Sum Insured should be completely exhausted - The Recharge option kicks in only after you have completely exhausted the Basic Sum Insured.

2)    Same or Related Illness - The Recharged amount cannot be used for the same or any related illness for which a treatment has already been taken in the same policy year. However, there are certain policies that offer Recharge benefit for Same or Related Illness. 

Considering the above restrictions, we can say that a recharge plan works best with Family Floater Health Insurance Plan where the cost of one member’s treatment can easily wipe out the entire sum insured. The recharge option restores the sum insured which can then be used by the other family members and thereby reduce the financial burden on the family.

Considering the steep rise in healthcare cost in India, Recharge Benefit becomes an important feature and should be definitely considered while purchasing a Health Insurance Policy.