Health insurance and critical illness insurance are two important forms of coverage, each designed to provide protection against certain medical expenses. Health insurance can provide financial relief for doctor’s visits, hospital stays, treatment costs, and more, while critical illness insurance pays out a lump sum if you’re diagnosed with one or more specified illnesses. Although both types of policies have their advantages, it’s important to understand the differences between them so that you can make the right choice for your needs. This guide will explain what health insurance and critical illness cover entail and compare their features side-by-side so that you can decide which type is best suited for your lifestyle.
What is a Health Insurance Policy?
A health insurance policy is a type of coverage that pays for medical expenses such as doctor’s visits, hospital stays, surgery costs, and other treatments. Health insurance typically covers these expenses up to a certain amount or provides a percentage of the cost. Depending on your plan, it may also cover preventive care services like routine check-ups or immunizations. Most health insurance plans require you to pay a premium each month in exchange for coverage; the higher the premium, the more comprehensive the coverage will be.
Example:
Rakesh is a healthy 25-year-old who decides to purchase a health insurance policy from ABC Insurance. His plan covers doctor’s visits, and hospitalization costs up to 70%, with a monthly premium of ₹1000. Now, if Rakesh were to get sick or injured, he would only have to pay 30% of the expenses associated with his treatment—ABC Insurance would cover the rest.
What is Critical Illness Cover in Health Insurance?
Critical illness cover within health insurance can provide additional financial protection against serious illnesses beyond what is covered by your basic health insurance policy. Critical illness cover pays out a lump sum if you are diagnosed with one or more specified critical illnesses such as cancer, heart attack, stroke, and kidney failure. This money can be used to pay for medical bills, lost income due to time away from work, or other costs associated with your illness. Some plans may also offer additional benefits, such as access to counseling services or support groups.
Example:
Rakesh decides to upgrade his health insurance policy from ABC Insurance and add critical illness coverage. With this additional protection, Rakesh is now covered in the event he is diagnosed with one of the specified illnesses. If he were to be diagnosed with cancer, for example, he would receive a lump sum payment that could help him pay for medical bills or lost wages due to time away from work.
Health Insurance vs Critical Illness Insurance: Side by Side Comparison
Both health insurance and critical illness insurance protect against medical expenses; however, there are some important differences between the two policies. Health insurance typically covers everyday doctor’s visits and treatments as well as preventive care services, while critical illness insurance pays out a lump sum if you are diagnosed with a specified critical illness. Here is a side-by-side comparison of the two policies to help you make an informed decision about which one is best for your situation:
Health Insurance:
- This insurance coverage includes protection for various situations such as accidents, illnesses, and pre-existing conditions, and may also cover expenses related to maternity.
- It offers a variety of benefits, including cashless treatments, additional coverage options, and coverage for multiple family members.
- The cost of the insurance premium is determined by various factors such as the insurance company, coverage options, the number of individuals covered, and the sum insured under the policy.
- The sum insured can range from ₹5 lakh to ₹10 lakh
- From the start date, there is a waiting period of 1 to 4 years for pre-existing diseases and maternity benefits.
- This policy will remain valid until either the sum insured is used up or the expiration date is reached.
Critical Illness Insurance:
- The insurance policy only covers a specific set of severe illnesses, and the exact number of illnesses covered may vary depending on the insurance company.
- Once the policyholder is diagnosed with a specified critical illness, they will receive a payment that can be used in any way they choose.
- The cost of the insurance premium is determined by the insurance company, the extent of coverage for various illnesses, and the overall amount of coverage provided by the policy.
- The sum assured can range from ₹5 lakh to ₹50 lakh
- The critical illness policy has a waiting period of 90 days from the policy start date.
- The insurance coverage includes a survival period, which is the amount of time the policyholder must survive after the date of diagnosis in order for the policy to be valid. The survival period can range from 14 to 30 days, based on the policy.
- The policy will remain valid either until a claim is made or until the expiration date.
Health Insurance vs Critical Illness Insurance: When to Opt for One or the Other?
For some individuals, a health insurance policy may be all they need. For others, it can be worth considering critical illness cover in addition to their regular health insurance policy since it offers an extra layer of protection.
In general, if you have existing medical conditions requiring frequent doctor’s visits or treatments, opting for a comprehensive health insurance plan may be your best choice. On the other hand, if you’re looking for financial support in the event of a serious illness like cancer or heart attack, then critical illness coverage can provide peace of mind and additional security.
Ultimately, deciding between health insurance and critical illness insurance should depend on your needs and circumstances.
Finally, understanding health insurance and critical illness policies is essential before buying. Research the different options and compare plans to determine which best fits your situation. The right policy can help you feel secure, knowing that you have the protection you need in case of an emergency.
Conclusion
In conclusion, it is important to consider both health insurance and critical illness insurance when selecting the right policy for you. Health insurance can provide financial protection against everyday doctor’s visits and treatments, while critical illness cover offers an extra layer of security by paying out a lump sum if you are diagnosed with one or more specified illnesses. Ultimately, deciding between the two should depend on your needs and circumstances. Do your research, compare plans, and feel confident that you have chosen what’s best for you.
