What is a top up health insurance plan and why do you need it

Health insurance plans provide a certain sum assured that covers you for any medical eventuality where the insurance company pays for hospitalisation, surgeries, medications and other items as mentioned in your insurance policy document. Insurance companies offer a range of health insurance products with each having its own USP. 

Types of Insurance Coverage

Insurers offer different types of health insurance products like Definite Benefit plans and Indemnity health Insurance plans. 

Indemnity health plans are traditional health insurance plans and covers hospitalisation expenses up to the sum assured. Definite Benefit plans is where the insurer is compensated for a pre-determined, fixed amount when a claim is made for an illness. There are that are offered by insurers and include the following:

Indemnity Health Insurance

  • Individual Health Insurance plan
  • Family Floater Health Insurance
  • Unit Linked Health Insurance
  • Mediclaim Insurance
  • Senior Citizen Insurance
  • Group Mediclaim

Definite Benefit plans include:

  • Critical Illness plan
  • Personal Accident plan
  • Hospitalisation cash benefit plan

“Top up” and “Riders” are Not The Same

Many policy holders are confused between a “top up” and a “rider”.  A rider is basically additional benefits that is added to the policy. Some benefits are not included in the terms of the policy plan and can be included in the policy by opting for riders. For instance, riders may include

  • Waiver of premium, 
  • Critical illness, 
  • Accidental death, 
  • Permanent and partial disability
  • Income benefit and much more.

The insured person opts for riders that are suitable for their specific needs and which is not already covered under the insurance plan. These riders are affordable and more economical than buying a separate plan. Employees who are already covered by their employers can simply purchase these riders at a reasonable price and have peace of mind. 

What is a top up?

A “top up”, on the other hand, extends your sum assured and gives you more health coverage. For instance, you can have a health cover of five lakhs and decide to get a top up plan of seven lakhs. If you have a medical expense of eight lakh the five lakhs will be covered by the basic sum assured and the balance three lakhs will be covered by the top up amount. If however, your claim is over twelve lakhs then the amount in excess of the cover will have to be paid by the insured. 

What is Covered Under the Top up Plan?

  • Insurers cover almost all hospitalisation expenses under the Health insurance top up plans. 
  • Top up plans can be purchased even if you don’t have a base plan whereas riders can be purchased only if you have a base plan.
  • Top up is like an indemnity plan which offers the same benefits as a basic reimbursable health insurance plan.
  • Top up are affordable and easy to purchase. 
  • No medical screening is required for persons who are less than 55 years of age. In the case of basic medical insurance policies, insurers insist on medical screening after you have crossed 45 years.
  • If your claim exceeds the threshold of your basic plan then you can club the insurance plan and the top up plan to cover the claim.

You have the option of buying from different insurance providers who will pay off the claim according to the insured sum. 

What are the Benefits of Top up Plans

Health Insurance top up plans have loads of benefits and are as detailed below:

  • You can enhance your policy coverage at the time of renewal of the policy.
  • If the plan has both the parents, then the child can be included in the same plan. 
  • Top ups can be converted to basic health plans.
  • Restrictions and sub limits on expenses like consultancy, room rent, lab tests are applicable. 
  • In some cases, insurers do provide a family discount. “Family” includes the policy holder, spouse, dependent parent and children up to a certain limit. 
  • A cumulative bonus (up to a specified percentage)for every claim free year is applicable.
  • Insurers generally offer a “Free Look” period. This means that the insurer can return the policy within 15 days of the purchase if the insured person in not satisfied with the terms and conditions.
  • No pre med is required (up to a certain age)
  • The policy can be renewed for the lifetime of the insured.
  • The premium paid comes under Section 80D of the income tax act. 

How do I Select a Top up Plan?

Before you decide a health Insurance top up plan, look for plan that is affordable and also has a higher tax deduction benefit. Also ensure that your top up plan does not have the same benefits as your basic health insurance. Make sure to check the waiting period of your top up plan regarding any pre-existing conditions, maternity cover, pre and post hospitalisation expenses etc.  Also check if the plan offers coverage for members of your family including your spouse, dependent parents and children. This will avoid disappointment when you realise that this was missing when file a claim.

What Is the Best Time to Buy Top up Insurance Plans

One of the best times to buy a top up insurance plan is when you feel that you will need additional cover (during the hospitalisation) without burning a hole in your pocket. 

In case of a relapse within 45 days of discharge then it will be considered as a fresh case. Basically, top up can be purchased when your basic plan limit is crossed. 


Top up plans for your medical insurance is a life saver to cover  cost of actual hospitalisation and your current policy. It is ideal for individuals covered under group health insurance policy to get covered for specific purposes.

If you are not sure of what sort of additional coverage you need, then it is advisable to talk to a insurance agent. Most of Insurance companies have customer support who are also available to guide you and help you make the right decision.

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