Restoration benefit in health insurance: Should you opt for it?

Health insurance is one of the 'must-have' insurance policy that helps you to prevent huge medical expenses burning your pockets. These days many health insurance companies are offering restoration benefit with their base health insurance policies. So, should you go for such policies? Before that, you need to understand what is restoration benefit and how does it work? 

Restoration benefit is nothing but restoring the amount of sum assured of your base policy. Simply put, it recharges your policy up to the sum assured of your base policy. Let us take an example to understand it better. Let us assume that you take a Rs 5 lakh sum assured policy having restoration benefit. Due to some ailment, you get admitted to hospital for which you claimed Rs 5 lakh. After you receive the claim of Rs 5 lakh, you would exhaust the sum assured of the base policy. This will now trigger the restoration benefit and your sum assured would again get restored to Rs 5 lakh. So, if in the same year, you again get admitted into the hospital and claim Rs 3 lakh, then due to restoration benefit, you would receive the claim of Rs 3 lakh.

However, though such policies are found to be quite beneficial, these policies come with certain conditions. There are some policies in which restoration benefit would only get triggered when you have completely exhausted the base sum assured. Say, for example, you have a base sum assured of Rs 5 lakh and you have made two claims in a year of Rs 3 lakh and 4 lakh. In such a case, you would receive the first claim of Rs 3 lakh, but for the second claim, you would receive only Rs 2 lakh, i.e. the remaining amount of the base sum assured. Now, the restoration benefit would get triggered and if you make a third claim of Rs. 2 lakh, you would receive the claim of Rs 2 lakh. On the contrary, there are some policies which provide restoration benefit even if you have exhausted the base sum assured partially. In the above example, if your policy gets restored even if base sum assured is partially exhausted, then you would be entitled to receive all the three claims of Rs 3 lakh, Rs 4 lakh and Rs 2 lakh.

Apart from the above, you also need to be aware that you would be paying slightly high premium for policies with restoration benefit. Also, if you own a family floater policy with restoration benefit, then there are some policies which have certain restrictions, such as you can only claim once and the next claim would only be available for other family members. There are also some policies which may restrict you from making a claim for the same treatment twice in a year. However, there are certain policies which have no such restrictions. 

So, now that you know, what should you do? Should you opt for a plain vanilla health policy or policies with restoration benefit. Having a policy with restoration benefit is advisable anytime. However, you need to check certain things as discussed above before buying the policy with restoration benefit. If you have a family history of certain diseases or treatment, then it is advisable to take a plain vanilla policy, along with super top-up policy as it will help you cover exorbitant medical expenses at low cost. As for others, restoration benefit is the way to go.