Things You May Not Know About The Restoration Benefit In Health Insurance Policies


Health insurance can be a valuable asset for those who need it, but it can also be expensive. That’s why it’s essential to understand the restoration benefit, which can help you save money on your policy. Here is what you should know about the restoration benefit.

Types of Restoration:

There are 2 types of restoration that health insurance policyholders can avail themselves of. The first type can get implemented when the total insured sum is exhausted completely. For example, suppose you are recovering from your second or subsequent surgical procedure at a hospital where you have an agreement in writing for such treatment. In that case, your insurer will shift the balance of insurance cover onto new recoveries until total exhaustion of the insured amount.

Having restoration coverage means that claim payouts won’t come out of the sum guaranteed but get shared between your scheduled amounts, which shall not be less than a certain amount at a time. 

The next type is ‘partial exhaustion’ through payment from any source or collection by third-party liquidation to the extent that such benefit makes possible timely and complete recovery without any further need for hospitalization, thus making it beneficial to the insured claimant. In other words, the restoration benefit is strictly for future claims and cannot be available for the first claim. It is crucial to note that the policyholder cannot avail of the advantage in the same insurance claim.

Restoration Advantage:

Before buying a health insurance policy, it’s essential to ask the company what the restoration benefit is. Restoration benefits allow policyholders to regain the entire sum initially insured for their illnesses, which can be a significant financial relief. Here are some advantages of purchasing a health plan with restoration: 

  • The restoration benefit can provide peace of mind that you’ll be fully protected should an illness take your life. 
  • It can be beneficial to have this type of coverage because it allows policyholders to reap all of the benefits from their health plan regardless of how much is left on their coverage term should anything unfortunate occur or if they are re-insured by another company at that time.
  • The Restoration Benefit is an intriguing aspect of health insurance because it means that affected individuals will always receive at least part, if not all, of their original insurance sum if their conditions are met under partial exhaustion.

Restoration Coverage:

Restoration cover, also referred to as the “refill option,” is a benefit offered with comprehensive health plans, in the case of a single standalone policy or one for the whole family. Although, in general, an add-on to the health plan, it may also be inbuilt into the actual insurance policy. It is advisable to purchase this additional option and your regular health plan. It can come in handy in the case of a second hospitalization within a policy year. The restoration option covers most out-of-pocket expenses (including room and board, medical bills, etc., and other associated costs). If you want to avail the restoration cover, you need to inform your insurer in writing in advance. As this is an additional benefit, you need to pay for it when your health plan renewal premium comes due. 

Restoration Premiums:

The restoration clause is built into the policy and means that you incur an additional cost to avail of these benefits. This extra premium amount depends on several factors, such as the term, plan type, other added features, and the insurer. It is vital to note that the insurer cannot raise the premium after the policyholder has made a claim. The previous amount stays in place once the restored benefit becomes operative. The policyholder can avail of the restoration benefits for a certain period, after which they will expire automatically. Some cases might have an option to renew the restoration benefits for another term if desired by the policyholder. It is essential to understand that the insurer cannot discriminate against policyholders based on their pre-existing health conditions. Likewise, companies such as doctors, hospitals, and other medical institutions aren’t allowed to discriminate against policyholders.

Health insurance is a vital part of our lives, and it’s essential to be well-informed about the different coverage options and premiums that are available. By reading this blog, you’ve learned about the restoration benefit and the different types of restoration available. You also learned how restoration coverage works and the premiums you’ll need to pay. Finally, to round things off, we recommend that you consult your financial advisor to assess the best coverage for you and your family.