Let us say Rajeev Ranjan has a health insurance policy that has a sum assured of Rs 5 lakh. If he has surgery where his hospital bill is Rs 5 lakh, does it mean that he will not have to pay anything from his pocket?
Not always. One of the reasons could be the presence of something known as insurance sub-limits.
What are sub-limits?
Sub-Limits are nothing more than a cap placed on the total amount that is insured for particular coverages, illnesses, claim types, and so on. The payment shall be provided in accordance with the limit that was stated at the time the policy was issued, with the sub-limit at the time of claims serving as the determining factor.
"The sum Insured in a policy is the maximum limit the policy will pay. Sub Limits in health policies are incorporated to limit the liability on certain procedures, items, etc., within the sum insured," says Shreeraj Deshpande, head of health businesses at SBI General Insurance.