Critical Illness vs Normal Health Insurance: Coverage, Premium, Sum Insured

Critical vs Normal Health Insurance Plan

Communicable and non-communicable diseases like hypertension, diabetes, corona virus, cancer, etc., are taking dangerous form. And Indians are at highest risk of these diseases. At the same time, medical inflation and the cost of medicine are skyrocketing.

Given the growing likelihood of diseases, the financial burden is obvious. A health insurance plan becomes important to deal with this financial crisis. In addition, there are also critical illness health policy plans that prove beneficial in major diseases. But, most of us consider health plans and critical illness schemes to be equal and interchangeable.

This article offers a brief understanding of a general medical policy and critical illness health insurance plan as well as the difference between the two.

What is a Normal Health Insurance Plan?

It is a compensation insurance scheme that pays only the maximum amount that is up to the sum assured. Under this, you are given full coverage. This includes hospitalization, pre and post expenses, day care treatment, ambulance cost, organ donor expenses, etc. The normal medical policy is designed to cover all expenses related to medical emergency but may or may not include coverage for critical illnesses.

What is Critical Illness Health Insurance Plan?

This policy provides coverage for a specified list of diseases mentioned in the contract. If you suffer from any disease covered by this scheme, you get coverage for all related medical expenses.


The general medical policy provides coverage on various ailments in the hospital in case of emergency. This includes in-patient hospitalization, pre and post hospitalization, ambulance cover and hospitalization.

Besides, coverage is also provided by various schemes for AYUSH treatment, domicile hospitalization, restoration of sum assured, maternity expenses etc. However, the maximum coverage of these are also provided in the critical illness scheme but only for specified diseases.

Sum Insured

Health insurance plans allow higher coverage amounts than serious illness plans. The sum assured allowed in such medical policy is Rs. 5-6 crores. However, under high coverage in critical illness plans, the maximum sum assured is up to 2 crore.


Simple health insurance is an indemnity based plan. Under which you only meet the claim under the expenses of the hospitalization. Cannot be used for any other purposes. On the contrary, critical illness plans are fixed benefit plans. These plans pay the sum assured. You can get the best treatment from it.


Since the health insurance plan offers more detailed coverage, the premiums are naturally higher in case of normal cover. On the other hand, critical illness plans are cheaper than health plans in terms of premiums.


A health insurance plan is essential in today’s time. It provides an all-round coverage for your medical contingencies and keeps you stress free. However, normal health insurance cannot be substituted for critical illness health policy. It is an essential cover and should be given first preference. 

Author Bio:

I am Nikesh Mehta, owner and writer of this site.

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I’m an analytics and digital marketing professional and also love writing on finance and technology industry during my spare time. I’ve done online course in Financial Markets and Investment Strategy from Indian School of Business. I can be reached at [email protected] or LinkedIn profile.

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