What Are Top-up Plans In Health Insurance?

6 mins read
by Angel One
A top-up plan is an add-on health insurance policy that provides additional coverage beyond an existing health insurance policy. There are two different types of top-up plans that you can opt for.

The rising medical costs can quickly burn a hole through your savings if you ever get hospitalised. Thankfully, you can avoid healthcare expenses eating into your finances by purchasing health insurance. 

When you’re insured with a health insurance policy, you don’t have to pay for your medical treatment and hospitalisation expenses out of pocket; the plan will pay them instead. However, the plan will only provide coverage up to a certain limit chosen by you at the time of purchase. 

But what if you need additional coverage beyond the one already provided by a health insurance plan? Here’s where top-up plans in health insurance come into the picture. Read on to find out more about these plans and how beneficial they can be.      

What Are Top-Up Plans with Respect to Health Insurance?

Top-up health insurance plans are supplementary plans that enhance the financial coverage offered by existing health insurance policies. Since the premiums of top-up policies are far lower compared to standalone health insurance, they’re considered to be a cost-effective way to avail additional insurance coverage. Generally, the top-up plans’ coverage becomes active only once you exhaust the sum insured amount in your primary health insurance policy. 

What Are the Different Types of Top-Up Plans in Health Insurance

There are two major types of top-up plans you can opt for – regular top-up health insurance and super top-up health insurance. Here’s a more detailed overview of each of these two types. 

  • Regular Top-Up Health Insurance 

A regular top-up health insurance plan is designed to provide coverage during situations where single hospitalisation costs exceed the sum insured amount of the base insurance policy. For instance, let’s say that you have a health insurance plan that provides coverage for up to ₹5 lakhs. You also have a top-up health insurance worth ₹5 lakhs. A sudden illness requires you to get hospitalised, with the total medical costs coming up to ₹7 lakhs. Since the medical costs exceed the sum insured by the base insurance policy, the top-up plan would kick in and provide coverage for the remaining ₹2 lakhs (₹7 lakhs – ₹5 lakhs). 

To put it simply, a regular top-up health insurance plan only comes into play if the costs associated with a single hospitalisation visit exceed the sum insured by the base insurance. 

  • Super Top-Up Health Insurance 

A super top-up health insurance plan, on the other hand, takes into account the cumulative expenses of multiple hospitalisations in a single policy year. Once you exceed the sum insured amount of your base health insurance over multiple visits, the super top-up plan comes into play. 

For example, let’s say that the sum insured of your base health insurance plan is Rs. 5 lakhs and that you also have a super top-up health insurance plan. You get hospitalised at the start of the year, which costs you ₹1.5 lakhs. A few months down the line, you get hospitalised again, with the medical costs reaching ₹2 lakhs this time. And then again, right around the end of the year, you undergo a surgery that costs ₹4 lakhs. The cumulative medical costs come up to ₹7.5 lakhs (₹1.5 lakhs + ₹2 lakhs + ₹4 lakhs). Since the cost of the third hospital visit finally exceeds the sum insured by your base insurance policy, the super top-up health insurance kicks in and covers the additional ₹2.5 lakhs (₹7.5 lakhs – ₹5 lakhs). 

What Are Some Key Features and Benefits of Top-Up Plans in Health Insurance?

Add-on health insurance like top-up plans has several key features that set them apart from traditional insurance. Let’s take a look at some of the key benefits and features. 

  • Coverage Extension 

Top-up health insurance plans are designed to be used in conjunction with a base health insurance policy. They extend the coverage of the base plan and can come in handy when your medical costs increase unexpectedly beyond what’s offered by the base policy. 

  • Affordability 

One of the key features of top-up plans in health insurance is that they’re very affordable. The premiums of such plans are often very low compared to a traditional health insurance plan, serving as a cost-effective way to increase coverage without having to purchase a separate policy.

  • High Deductible Amount

Top-up health insurance plans only provide coverage after the deductible amount is fully exhausted. The deductible amount for top-up policies is most often the sum insured amount of the base health insurance policy. Depending on the plan you opt for, the deductible amount can either be a single claim deductible or a cumulative deductible. 

  • Flexibility 

Another major feature and benefit of top-up plans in health insurance is the flexibility that they offer. For example, you can choose the sum insured and deductible amount based on your requirements and the existing coverage that your base health insurance plan offers. Remember, the higher the deductible you choose, the lower the premiums of the top-up plans are likely to be. 

  • Waiting Period 

Similar to regular policies, some top-up health insurance plans come with a waiting period for certain specified illnesses and diseases. The coverage of top-up plans will only kick in once the waiting period expires.  

  • No NCB

No-claim bonus or NCB is a discount on premiums that insurance providers offer for every claim-free year. For every claim-free year, the no-claim bonus percentage increases, topping out at 50%. While traditional health insurance plans offer NCB, the facility is not available with top-up plans. This means that if you don’t utilise the coverage provided by a top-up plan during a year, you will not be provided any no-claim bonus. Instead, you need to pay the full premium to avail the coverage for the next year.  


Top-up plans in health insurance are a great way to get additional coverage. They’re very affordable, easy to purchase and can be completely customised depending on your needs. That said, before opting for such plans, it is advisable to compare multiple options. This will help you pick the best top-up health insurance that’s in line with your requirements. Also, remember to read through the terms and conditions of the policy carefully before purchasing. 


What is a deductible in a top-up health insurance plan?

The deductible is the threshold amount that needs to be crossed before a top-up plan starts covering medical expenses. Many insurance providers let you choose the deductible amount for a top-up plan at the time of purchase.

How does a top-up plan differ from a regular health insurance policy?

Top-up plans in health insurance often have high deductibles and will only provide coverage after the deductible is exhausted. With regular health insurance policies, however, there’s either a low or no deductible.

Do top-up plans in health insurance have a waiting period?

Yes. Top-up plans in health insurance come with waiting periods for certain specific illnesses and diseases. The plans will only start providing health insurance coverage for the specified diseases and illnesses after the expiry of the stipulated waiting period.

Are the premiums paid toward top-up plans in health insurance plans eligible for tax deductions?

Yes. The premiums you pay towards top-up health insurance plans can also be claimed as a deduction under section 80D of the Income Tax Act, 1961.

Are top-up health insurance plans affordable?

Yes. Since top-up health insurance plans charge lower premiums compared to standalone health insurance policies, they’re a cost-effective way to enhance your overall coverage.