DNA India
28 May 2011
By Abhishek Kumar Singh

While presenting a financial plan ‘J V "1 plan I told our clients Shankar Patil and his wife, "You and your spouse will have to go for medical tests, and once the insurance company is with the reports. it will issue you a health insurance policy which will cover both of you." They were quite surprised.

Even being in their mid 505, did not have any medical insurance policy. They never felt the need for the same as company had provided them with a group mediclaim policy As Patil would be retiring in another 4 to 5 years, the company policy would cease to exist and the couple will be left without any health cover policy. Not having a mecliclaim policy at old age may be quite a strain on the financial health of the family besides the physical pain.

My client got very sceptical when I informed him about the medical test. The couple asked us to suggest some insurance companies which do not require medical reports before issuing a policy. This is quite common that people are not very comfortable for medical tests. First let us understand, why does an insurance company ask for a medical check up before issuing a policy. Insurance is a product that is supposed to cover people with similar risk at similar cost. For example Iet’s take two people who are of the same age, same gender and earn similar income. The only difference is that one is obese and the second one is healthy Risk of the person falling ill is much higher compared to the second person.

In case an insurance company decides to offer them policy, then it will not be fair to charge both of them the same premium. as the risks they face are different. So the insurance company will charge a higher premium from the person. The higher premium has assured that any disease arising out of his obesity will be taken care of in the health insurance policy The fact that he is obese came out from the medical check up he underwent fore the policy was issued.

Consider this, if the medical test of the Erst person was not done, and he had tested his weight some six months back, thus he know his current weight. So he filled up that weight column and that is not wrong reporting according to him. But it is a case of wrong reporting according to the insurance company In case he gets aclmined due to some problem arising out of obesity within a few days of buying the policy, then the insurance company will reject the claim stating that he was obese while buying the policy and the data presented while buying the policy was wrong. The insurance company can also cancel the policy based on this.

There are other positive aspects as well of getting the tests done. There may be various problems in our body which are unknown to us. It may happen that we have symptoms but they are ignored in our busy daily lives.

Only when we undergo medical check ups we come to know about these issues that may have critical impact on our health at a later stage of our lives. Also, once these tests are done, and you have filled up the form to the best of your knowledge, the insurance company cannot reject a claim stating it to be a claim arising out of pre-existing diseases. Also in case the insurance company asks for a loading on the premium, it simply means that the company is ready to cover those risks either stated by you or on the basis of the medical reports at an extra cost. Thus one can be relaxed that any complication arising out of that particular risk will be surely covered by the insurance company.

In life insurance also. the company cannot deny the claim stating that there was misrepresentation of fact at the time of Fllling up the form.

Thus, it is always better to go for medical tests while buying the policy and one doesn‘t need to be scared of it. In case the insurance company is trying to reject the claim stating that this was not reported in the application or this was due to pre-existing disease, you can show them a copy of all the medical tests done in that case. This will certainly put you on a safe pedestal.