Selecting the Right Nominee for your Health Insurance
With increasing lifestyle diseases and harsh climatic conditions becoming a cause of worry, the chances of medical emergencies have only gone higher. Getting a family health insurance policy prepares you financially by protecting your hard-earned savings from an unexpected blow. Also, it rids your family or dependents from an additional financial burden.
To ensure your family members do not miss out on any benefit of your mediclaim policy, you must take the utmost care when furnishing details to your insurer. It also includes filling in the correct nomination details.
The process could be a little confusing if you are a first-timer. Still, a guide to selecting a nominee for your mediclaim policy will clear all your doubts regarding the nomination of the right person as the beneficiary of your insured amount.
Definition of Nominee
A nominee is an individual chosen by an insurance policyholder for receiving policy benefits upon his or her death. Often, this is relevant in case of life insurance or personal accident insurance. But, even in health insurance plans, there is a provision to specify the nominee details. In an event when the insured person loses his or her life during medical treatment, the insured amount shall be paid to the nominee.
Even though this is not mandatory, you must specify a nominee in the health insurance proposal form so that your family gets the financial support.
It is crucial to inform your health insurance company about who is a nominee for your policy and the relationship that the person shares with you. In normal circumstances where the policyholder is claiming hospitalisation benefits under a health policy, the nominee does not have a role. Their part comes into the picture in instances like death during hospitalisation or as a result of an accident. In such events, it is either the legal heir of the deceased or nominee who gets the sum assured, as per policy terms and conditions.
When unexpected events happen, it is not just one person who suffers but the entire family. Thus, safeguarding dependants is of utmost importance so that there are no financial difficulties. By selecting someone as a nominee, you are securing their future.
How to Select the Right Nominee for your Insurance Plan?
When the question is about who should be the nominee for your family health insurance policy, you are not bound by any rules. You can choose to nominate anyone - a friend, relative or an immediate family member like spouse and children.
However, mentioning your immediate family member(s) as a nominee(s) is a wise decision to make when you consider expenses incurred during accidental hospitalization - a time when your family needs financial and emotional support.
If it is a cashless mediclaim, the medical bills are settled directly with the hospital, subject to policy terms and conditions. But, in case of reimbursements, the amount will be paid to the nominee.
Here are some points which you must consider when selecting a nominee:
- Provide complete details: You are required to provide correct information of the nominee including their full name, address, age, date of birth and the relationship they share with you. Any incorrect information can create a problem when raising an insurance claim.
- Option to change nominee details if required: As a policyholder, you can appoint a new nominee if required by suitably informing your insurer. If the nominee dies before the policyholder, the benefits will go to the legal heirs.
When buying an insurance plan, there is an option to nominate a 'minor' - a person less than 18 years of age. If you are nominating your minor child, you should specify the details of the guardian or appointee alongside. However, your child legally cannot handle the claim amount until he or she becomes an adult. Thus, when choosing mediclaim or health insurance plans, you should avoid nominating your minor child. Selecting the right nominee is also essential when opting for personal accident policies.