You think taking care of health is a big undertaking? Try taking care of your health insurance. Or any insurance for that matter. But there are ways to make it simple and smooth and yes, you can do it yourself.
A friend recently sent me a Whatsapp forward called ‘A long rant on health insurance…’ it included problems in buying and maintaining other forms of insurance also.
A retired journalist himself, this forward was a compilation of a discussion with his peers. CoverNote readers would agree with most points, including about writers’ shortfalls.
Of the many good points, let us see some in this instalment of CoverNote.
Getting spammed
How to choose a policy, given too many variables was a major problem. One that, unfortunately, publications “glibly say, read brochures, compare. Who has the time?” As for online brokerages and aggregators, their experience is they are poorly informed and, what is more, only forward numbers to companies and you get spammed. Insurance company websites themselves don’t have easy-to-find comparative charts of features either.
All these are true mostly and, if I may add, your own agent or broker/ adviser, does not add much value or provide greater clarity.
We have tried to address these issues in CoverNote at different points in time and about all classes of insurance, but this is advice worth repeating and updating.
So, we will do a new, improved version of how to go about it!
Focussing for now on the point about too many variables, yes this is a compound problem. The mutual fund industry faced a similar chaos and the regulator, about a year or two ago, simplified things by announcing a set of categories or variants of funds that could be offered.
This streamlined the market offerings and seems to have led to less anxiety among lay investors.
I am pretty perplexed because of this same challenge when I need to buy a mobile phone or a car. Small and sometimes puzzling features are added or subtracted to make a new variant. So, correlating price, benefit, and the value that a feature presents to me as a user probably needs an algorithm. So, we go out and buy what our friends have bought.
The same approach can be disastrous for insurance. However, the insurance regulator, about three years ago, created standardised policies in each category like health, life, home insurance, annuity policies and so on, and mandated each insurer to offer it.
Optimum coverage
The policies are well-designed for optimum coverage. In fact, if you are in a hurry for a cover, this would be a good choice provided you take the time between now and renewal to do some more homework and renew with a better option/ variant. This factor will apply only to annually renewable policies, which means life and annuity policies are not suitable for this quick approach.
We have, in CoverNote explained each standardised policy in detail and given a toolkit how to use it to arrive at the best policy for yourself. This exercise we will continue with new policies and variants. These are as far as buying policies are concerned. About claims-related grievances await further instalments of CoverNote.
(The writer is a business journalist specialising in insurance & corporate history)