What Is Hospital Cash Insurance: Benefits and What Does It Cover?

What Is Hospital Cash Insurance: Benefits and What Does It Cover?

In this fast-paced world that we live in, health is one of the most valuable assets. Our health is at significant risk due to our modern lifestyle and most companies have included mediclaim or health insurance as part of their salary benefits. However, some people also invest in a health insurance policy in an individual capacity. Although most health insurance plans provide comprehensive coverage, there are certain expenses that will not be covered. In order to make up for that, health insurance providers have designed the hospital cash insurance to help protect your finances.

What is Hospital Cash Insurance?

Hospital cash or hospice insurance is a type of insurance policy that pays a fixed amount to cover miscellaneous expenses for each day of hospitalization that exceeds 24 hours. This daily cash benefit cover is typically provided as a basic plan or can be purchased as an additional cover.

Benefits of Hospital Cash Insurance

Hospital Cash Insurance provides a lot of benefits. Some of them are:

Taking care of hospital bills: In case of a large hospital bill claim, your health insurance might not be able to cover the entire claim. A hospice insurance policy will help you in paying for the additional expenses that might come up.

Standard amount: You will receive a predefined amount as reimbursement by the insurer irrespective of the bill amount. You can use this money according to your needs and requirements and you don’t have to declare it.

No need of supporting documentation: The claim process of hospital cash insurance is straightforward and hassle-free. You do not have to submit any supporting bills for hospitalization for more than 24 hours.

tax benefits: Section 80D of the Income Tax Act lets you claim tax deductions for health insurances that you have taken. It can be used for tax planning as a tax deduction of up to ₹25,000 for non-senior citizens and up to ₹30,000 for senior citizens are available.

No Claim Bonus (NCB): Health insurance plans provide NCB in which you will be given a discount on renewal premium if you do not claim anything or claim very less in the current year. If you are hospitalized for a minor complication and the bill is less, you can pay for it using the hospital’s cash insurance rather than making a health insurance claim. This will allow you to claim the NCB of the health insurance policy which would otherwise be claimed.

Coverage Provided Under the Hospital Cash Insurance

If the insured individual is hospitalized for medical treatment, then the insurer will pay a lump sum daily. The cash benefit ranges from ₹100-₹1000 but the actual figure will vary from insurer to insurer. You can also use this to cover up for loss of income during the hospitalization period.

Certain expenses are not covered by health insurance plans, even though the mediclaim policy covers hospitalization charges. Expenses such as X-ray costs, blood tests, surgical accessories, etc., are usually not covered. A hospice policy gives you a lump sum in the event of hospitalization, which you can use as you see fit.

If the insured individual is admitted to the ICU, then the cash benefit is doubled. For example: if the cash benefit for a regular room is ₹1500, when admitted in an ICU it becomes ₹3000.

Hospital cash insurance is a savior during difficult times when extra expenses burn a hole in your pocket. It gives you a fixed amount of money each day that you are hospitalized. It is especially useful in cases where you are seeking medical treatments regularly and need cash to cover these expenses.

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