- Room Rent Capping
- Proportionate Deductibles
- Benefits of No Limit
Concept of Room Rent Limit In Health Insurance
When planning your vacation, we often find ourselves browsing the internet for pocket-friendly rooms. Apart from creating a budget for transport, food, and shopping, accommodation is among the most expensive things when travelling.
However, during a medical emergency, you do not have the luxury to look at room rents. Receiving quality health care and efficient assistance is what matters. On further analysis, you will find how room rents are one of the most important along with the treatments availed during hospitalization.
Health insurance has multiple elements that are misunderstood. In this article, we shed light on the concept of
- Sub-limits
- Room rent limit in health insurance
- Types of room rent, and
- What happens on exceeding room rent capping
What Is A Sub-Limit In Health Insurance?
Before we talk about room rent limits in health insurance let us understand the concept of sub-limits in health insurance.
In simple words, sub-limits are fixed percentages of your sum insured that your health insurance plan will bear for different medical care expenses. For example,
- Room rent limit
- ICU limit
- Road Ambulance limit
- Specific medical procedures, etc.
What Is Room Rent Capping?
Room rent is the maximum amount your health insurance plan will reimburse or pay directly to the hospital for room rent during your hospitalization.
Let us understand this with an example
Mr. Brijesh is admitted for planned surgery in a network hospital for 4 days. Post-surgery Mr. Brijesh can opt between two hospital room categories
- General Ward - Room rent limit INR 2500 per day
- Private AC room - Room rent limit INR 4000 per day
As per the health insurance plan purchased by Mr. Brijesh, the room rent limit is INR 3,000 which means the general ward is well within the room rent limit covered by the health plan.
However, if Mr. Brijesh opts for a Private AC room he exceeds the given room rent limit due to which his claim will be affected as per the proportionate clause in health insurance.
What Is Proportionate Deductible Clause In Health Insurance?
The proportionate deductible clause is applied by health insurance companies on room rent. It means that companies determine the excess room rent you paid over the sub-limit of your health plan.
Further, your health insurance provider will deduct a proportionate amount from other services availed by you during hospitalization such as
- Surgery Fee
- Doctor consultations
- ICU charges, etc.
P.S. - We have explained the effects of the proportionate deductible clause on your overall claim settlement in the next segment.
What Happens If You Exceed Your Room Rent Capping?
Room rent limit in health insurance is carefully considered while settling health insurance claims. It is essential to stay within your room capping per day to avoid paying extra out of your pocket.
Let us understand this with an example
| Health Cover | INR 15 Lakhs |
| Room Rent Limit | INR 10,000 per day |
| Hospital Room Rent You Paid | INR 20,000 per day for 8 days = INR 1,60,000 |
| Other Hospitalization Expenses | INR 5,00,000 |
| Total Hospital Bill | INR 6.6 Lakhs |
| Claim Settled by Insurer | INR 3.3 Lakhs |
| Out Of Pocket Expenses Paid By You | INR 3.3 Lakhs |
Confusing right? Why did the health insurer only cover your hospital bill of INR 3.3 L when you have a health cover of INR 15 L?
Due to the proportionate deductible clause, your overall claim settlement is affected.
Since you opted to pay 50% of the room rent out of your pocket which indicates that you are capable of paying the rest of the medical care bill as well.
Types Of Room Rent Limits
Now that we have discussed the concept of room rent limit, let us further understand the different types of room rents.
| Type Of Room Rent Limit | Explanation |
| Room rent with no sub-limits | Many health plans come without sub-limits giving you the freedom to choose any category of hospital room |
| Room Rent with Co-Pay | You and the insurance provider will share the expenses of the room rent |
| Room rent with capping on specific room types | Your health plan offers specific room rent capping on different kinds of rooms like deluxe suites, Private AC rooms, etc. |
| Room Rent With Capping | Health plans put a maximum amount on room rent that insurance holders can avail of |
| Room Rent Waiver | On adding a room rent waiver add-on the room rent capping set by your health insurance plan is removed |
Benefits Of No Room-Rent Limit In Health Insurance
Opting for health plans with no room rent limit has its perks which are listed below:
- You have the flexibility to opt for any room category during hospitalization which will later be settled or reimbursed by your health insurer
- With no room rent limit, you have the freedom to opt for any category of room providing you with the best facilities during hospitalization
- Opting for no room rent limits in a health insurance plan will help you save money, as customers who opt for a higher category of health plan variant are often offered discounts by health insurers
- By selecting a health insurance plan with no room rent capping you have the opportunity to opt for better hospitals with better facilities (including rooms) and advanced equipment
Wrapping It Up
The concept of sub-limits is heavily misunderstood by many during the purchase of a health insurance plan. It is essential to understand the room rent limit in health insurance and if the proportionate deductible clause applies to your health insurance policy.
If yes, consider sticking to the sub-limits mentioned in your health insurance. Contact our insurance experts for further information on room rent capping and all the details associated with the same.
Health Insurer Network Hospitals
Room Rent Limit In Health Insurance: FAQs
1. What is the room rent limit for health insurance?
Room rent limit in health insurance refers to the maximum amount your health insurer is willing to pay during your hospitalization as mentioned in the policy clause.
2. What is the room rent capping in health insurance?
Most commonly, room rent capping for most health insurance providers is at 1% or 2% of the sum insured. However, it varies from insurer to insurer. Do not forget to read the policy schedule to understand all the essential sub-limits.
3. What is the concept of proportionate deductibles for room rent limits in health insurance?
According to the proportionate deductibles concept, if you exceed your room rent limit, all other expenses will also be calculated based on the formula of proportionate deductibles. Proportionate deductibles = room rent eligible/room rent availed X 100
4. Should you purchase health insurance plans without sub-limits?
A health plan with no capping on room rent may have a higher premium but will provide you with peace of mind, flexibility to avail the best facilities while undergoing treatment, as well as better access to the best network hospitals.
5. How will a room rent waiver add-on impact your overall health insurance claim amount?
Room rent waiver add-on can be purchased along with your base health plan which removes room rent capping from your health insurance policy. Thus, giving you the freedom to opt for any room category during hospitalization.
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Written By: Simran Kaur Vij
Simran is an insurance expert with more than 4 years of experience in the industry. An expert with previous experience in BFSI, Ed-tech, and insurance, she proactively helps her readers stay on par with all the latest Insurance industry developments.
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