Do you know the difference between a Top-up and Super Top-Up plans of medical insurance?

(This article analyses different scenarios where top-up or super top-up plans are useful)

The Top-up plan of health policy covers hospitalization expenses when a single hospitalization claim exceeds the base policy. You cannot make a subsequent claim under the top-up policy when the sum available under the base policy is exhausted. In other words, the Top-up plans work on a ‘per claim’ or ‘per single hospitalization’ basis, they are beneficial as long as the single claim amount is above the threshold limit.

The Super top-up plans are similar to top-up plans, except that the top-up plan covers a single claim above the threshold limit, while the super top-up plan covers ‘multiple’ hospitalizations and looks at the aggregate claim. The claims under the super top–up policy can be made when the total claims exceed the threshold limit of the base policy.

Situation 1: Single bill in a year (Base policy for Rs.4 lakh)

In the above situation, the insurance company settles the entire claim amount of Rs.4 lakh from the base policy. A Top-up or super top-up plan does not pay.

Situation 2: (Base policy 4 lakh+ top-up or super-top up for Rs.5 lakh): Claim submitted in a Single bill of Rs.10 lakh

In the above situation, the insurance company settles the threshold limit of Rs.4 lac from the base policy and the remaining Rs.5 lakh from the Top-up or super top-up plan, as the case may be. The total settlement in both cases was Rs.9 lakh.

Situation 3: Multiple bills in a year (Base policy 4 lakh+ top-up or super-top up for Rs.5 lakh): Claim submitted through multiple bills as under)

In the case of the first bill of Rs.2 lakh, the insurance company settles the entire claim amount of Rs.2 lakh from the base policy. A Top-up or super top-up plan does not pay. In the case of the second bill of Rs.6 lakh the insurance company settles the claim amount of Rs.2 lakh from the base policy (together first and second bills Rs.4 lakh settled from the base policy).  Top-up or the super top-up plan as the case may be, pay the remaining claim amount of Rs.4 lakh. In the case of the third bill, the insurance company settles Rs.1 lakh from the super top-up plan (Rs.4 lakh in the second claim and Rs.1 lakh in the third claim settled, the aggregate of Rs.5 lakh is covered under the Super top up). No claim from a basic or top-up plan is allowed as the threshold limit of Rs.4 lakh is already settled in the first and second claim and you cannot make subsequent claims under the top-up policy when the sum available under the base policy is exhausted.[ in other words, once the basic threshold of Rs.4 lakh is exhausted, you cannot claim a medical bill under the top-up policy (though the amount available under the policy) whereas you can claim the same bill under the super-top-up policy even though the basic threshold of Rs.4 lakh is already exhausted].

N.B: In both the cases of Top-up and Super Top Up plans, a policyholder cannot claim the amount disallowed in base policy due to sub-limit fixed or due to proportionate clause or for any reason like limit fixed for Doctors’ fees, surgery/operation charges, nursing expense, medicine cost, and room rent, etc. in the base policy.

CONCLUSION: If you do not anticipate getting admitted to a hospital not more than once in a year, a top-up plan would be suitable to your needs as the premium amount would pinch much less.  However, if you foresee the risk of being hospitalized more than once a year from chronic diseases, it is best to pay for a super top-up plan.

Hospitals charges are not the same for the same services; they are different depending on the room type like General, Shared, Private, Deluxe, Super Deluxe, etc. Suppose, your eligible room rent per day is Rs.5000/- and in case you have opted for a room rent of Rs.10000/- per day as other types of rooms are not available at the time of admission to the hospital. Then not only additional room charges but all charges of the hospital except the cost of medicines with MRP would also be proportionately reduced when the claim is paid by the insurance company.

However, the above clause of room rent linked to hospital bills is not applicable to IBA group insurance for bank staff and retirees. There shall be no capping under any head including room rent/ICU rent for IBA group insurance for bank staff and retirees subject to overall hospitalization claim restricted to the available sum insured under the Policy.

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