Insurance Uncovered: What is Restore Benefit in health plans?

Insurance Uncovered What is Restore Benefit in health plans Mintpro

Health insurance plans constantly upgrade the coverage benefits offered by them. The plans adapt to the changing needs of customers and provide value-added benefits. Many of your customers don’t know about these improved benefits offered by health plans. It is either due to a lack of technical understanding or ignorance that your customers remain unaware of the unique coverage benefits of health insurance plans.


So, if you are aware of the pros and cons, you can educate your customers about the same. So, let’s know more about it.


What is restore benefit in health plans?


Restore benefit promises to restore or reinstate the sum insured of the health insurance policy if it is exhausted in any policy year. Here’s an example to understand the benefit better–


Suppose, in a health plan with sum insured of INR 5 lakhs, there is a restore benefit which restores 100% of the sum insured if it is used up in a policy year. If there is a claim of INR 5 lakhs, the sum insured would be used up. If there is another claim in the same policy year, the restore benefit would come into effect and the sum insured of INR 5 lakhs would be refilled. Thus, the plan would again have coverage of INR 5 lakhs which could be used for the second and subsequent claims.


Important aspects of the restore benefit


You saw how restore benefit provides the benefit of double sum insured in the health plan in case of multiple claims. However, there are some important factors about the benefit which you should know. These include the following–


  • The rate of restoration


Health plans allow 50% or 100% restoration of the sum insured during a policy year.


  • Application of the benefit


Restore benefit is applicable if the subsequent claim is made for another unrelated ailment or sickness. If the claim is made for the same illness on which the sum insured was exhausted, the restore benefit would not work. For instance, if, the sum insured was exhausted in treating cirrhosis of the liver, the subsequent claim should be for an illness unrelated to the liver for the restore benefit to apply. If the treatment for cirrhosis has been unsuccessful and subsequent claims are being raised for further treatments of the liver, restore benefit would not be applicable.


  • When will the benefit apply


Restore benefit applies in subsequent claims. It is not applicable if the first instance of the claim exceeds the sum insured. For instance, if the sum insured is INR 5 lakhs and the treatment costs come to INR 7 lakhs, the restore benefit would not be applicable. The policyholder would have to pay the excess amount of INR 2 lakhs for the first claim for which the sum insured proves insufficient. For future claims, however, the sum insured would be restored to INR 5 lakhs.


  • Frequency of application


Restore benefit is, usually, applicable only once during the policy year. Some plans, however, allow the benefit to be applied whenever the sum insured is exhausted during the policy year irrespective of the number of times.


Benefits of the restore feature


The restore feature is a great addition to a health insurance plan for your customers. Here’s why–


  • It provides your customers the benefit of double sum insured which proves handy in case of multiple claims


  • The benefit ensures that the health plan would not fall short in meeting the claims


  • In family floater plans the benefit helps family members avail additional coverage


  • The benefit is, usually, inbuilt in health insurance plans thereby no additional premium is required to be paid for it.


Help your customers understand the meaning, aspects and the benefits of the restore feature. The feature might already be in their health plans and they should know about it. If it is not, you get the opportunity to sell a health plan which contains the feature. Besides giving your customers benefit, you would also be able to increase your earnings by selling new health plans with restore benefit.


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