Should I port my health insurance policy which has a cap on room rent?

My health insurance policy has a room rent limit of ₹5,000 per day. If I get admitted to a hospital where the room costs ₹10,000 per day, how will this affect my entire claim? Should I consider porting my policy to the one without any room rent capping?

– Name withheld on request

Many policyholders are unaware of how room rent capping can impact their claim settlement. Most health insurance policies have a daily room rent limit. In your case, it is ₹5,000 per day. If you choose a room that costs ₹10,000 per day, you are exceeding your eligibility by 100%.

But here is the catch—the insurer will not just deduct the extra ₹5,000 per day room cost. They will apply what is known as a proportionate deduction to the entire hospital bill, except for items that are not linked to room category.

When you opt for a room category higher than your eligible limit, the insurance company calculates the ratio of eligible rent to actual rent. In your case, it will be 50% ( ₹5,000 / ₹10,000).

This means they may pay only 50% of the entire bill related to hospitalisation (room charges, doctor visit charges, nursing, and other associated costs that vary with room category).

However, costs that are not linked to room rent capping will not see any proportionate deductions. These include medicines and consumables, implants (like stents), and medical devices. Diagnostic tests may or may not see proportionate deduction. Some hospitals charge different prices for the same as per the room category.

At discharge, review your hospital bill carefully. Identify which charges are variable based on room type (doctor visit fees, nursing, etc.) and which are fixed (medicines, implants). This will help you understand if deductions are proportionate or if any part has been wrongly reduced.

As a policyholder, you must know your room rent limit in advance. Inform the hospital TPA desk and choose a room within your eligibility to avoid proportionate deductions.

If you wish to stay in a higher category room for personal reasons, be prepared for the proportionate deduction impact.

Being aware of this clause before hospitalisation can save you from surprises at discharge. Always check your policy document for room rent capping and choose wisely. We recommend you to port your policy to the one without any room rent limit. Your premium will go up but you will get better protection.

(Shilpa Arera is Co-Founder & Coo at Insurance Samadhan)