Some months ago, a friend called me—relieved and exhausted in equal measure. His mother had just completed a long cancer treatment.
The total bill was ₹38 lakh. He had done everything right: a base policy of ₹20 lakh and a ₹1 crore top-up with a ₹20 lakh deductible. On paper, he was well covered.
What he had not anticipated was the process. It took four months to receive the full claim. There were repeated requests for documents. At one point, the top-up insurer temporarily declined the claim because the base insurer had not yet settled.
The claim was eventually paid. But the journey was far harder than expected.
In my previous column, I wrote about why is a cost-effective way to increase health cover. I also noted that the claims process with a base and top-up combination is rarely as seamless as a single policy. Here is why.
Deductible lowers cost but adds complexity
A top-up policy pays only after expenses cross the deductible.
The deductible is chosen when you buy the policy, typically between ₹3 lakh and ₹20 lakh. If, like my friend, your deductible is ₹20 lakh, the top-up pays only after expenses exceed that amount.
It does not matter who paid the first ₹20 lakh, your base insurer, your employer’s group cover, or you personally. What matters is proof that the expenses were incurred.
If you paid the bills yourself, you must submit original bills, discharge summaries, diagnostic reports and payment receipts showing that the deductible threshold has been crossed.
If the base insurer settled the claim cashless, you will still need the letter showing exactly what the insurer paid the hospital. Without it, the top-up insurer cannot process the claim. That letter alone can take weeks to arrive.
Cashless claims require coordination
Top-up claims can be settled without cash, but only with coordination.
The hospital must be on the top-up insurer’s network and you must seek separate pre-authorization from the top-up insurer. Most hospitals are unfamiliar with this dual process and often find it cumbersome.
Insurers also follow different practices. In reality, many top-up claims end up as reimbursements even when the base claim was cashless.
That means you may have to pay large sums upfront while pursuing the claim. This problem is smaller if the base and top-up policies are with the same insurer. The insurer can easily see when the deductible has been crossed.
If you are healthy and have no major pre-existing conditions, keeping both policies with the same insurer simplifies claims. But if you have medical conditions that could lead to disputes, it may be safer to keep the insurers separate.
Room rent caps complicate the math
Room rent limits in the base policy can make deductible calculations tricky.
Suppose your base policy allows ₹5,000 per day for a room but you stay in a ₹10,000 room. The insurer credits only ₹5,000 per day toward the deductible. The remaining ₹5,000 becomes your personal expense.
Proportionate deductions may also apply to other hospital charges.
You must then submit both the base insurer’s settlement letter and proof of your personal payments to the top-up insurer. More documents usually mean more queries and more time.
Keep documents ready
Before making a top-up claim, organize these documents:
Policy documents for both base and top-up plans, including sum insured and deductible.
All and receipts, preferably itemized.
The claim settlement letter from base insurer.
Diagnostic reports and discharge summaries.
Pre-authorization correspondence with insurers.
Arrange them chronologically. It can save weeks during claims.
The deductible resets every year
For prolonged illnesses such as cancer, this point is critical. The deductible resets at every policy renewal.
If your policy renews in April and treatment runs from February to December, expenses from February to March count towards the deductible for that year. From April, the clock starts again. You must cross the full deductible before the top-up pays in the new policy year.
Where medically possible, plan treatment so that expensive interventions such as surgery, chemotherapy or major diagnostics fall within the same policy year.
Still a good buy
None of this should discourage you from buying a top-up policy. The economics remain compelling.
The claims process can be more involved, but it is manageable if you are prepared. Think of the paperwork as the price you pay for cost-effective catastrophic cover.
My friend’s mother is now recovering well. The ₹38 lakh bill was largely covered by insurance.
He says he would make two changes if he had to do it again: keep the base and top-up with the same insurer to avoid confusion on when the deductible is crossed, and maintain a dedicated folder for every document from the start.
Those two steps, he says, would have saved months. I agree.
Kapil Mehta is co-founder, SecureNow Insurance Broker.