Difference Between Health Insurance and Critical Illness Cover

Medical Insurance vs Critical Illness Cover

Think your health insurance is enough in all cases? Maybe not. Though a health insurance policy is a must and all should have one, however, it may not be ideal for all situations.

A standard health insurance policy covers the majority of hospitalization costs. On the other hand, critical illness insurance provides a lump sum payment if you are diagnosed with a critical illness covered by the policy. This brings a change in your health insurance claims.

In such situations, hospitalization accounts for only 35% of the entire expenditure. Additional expenses such as pathology tests, counselling, and post-operative care can be covered by a critical illness cover. A critical illness plan is vital not only for covering the high costs of illness, but also for ensuring financial stability and compensating for financial losses incurred as a result of critical illness.

Health Insurance vs Critical Illness Insurance

There are few major differences between the two types of health insurance plans – Medical health insurance and critical illness insurance. Both policies are designed to provide financial protection to policyholders based on their individual circumstances. While health insurance provides coverage for the essentials, a critical illness policy is more extensive and provide further benefits.

Coverage Offered: While medical insurance plans provide for several illnesses and health conditions, the critical illness insurance plan covers severe illnesses and surgical procedures which can put immense pressure on your pocket in case of an emergency. The amount of health insurance claims in the latter is based on the severity of the illness and based on the conditions covered in the terms and conditions.

Policy Period: Typically, an ordinary health insurance plan is purchased for a single year and is to be renewed every year. To cover the risk of critical illness, a Critical Illness cover is often purchased for a longer period of time, such as 15 to 20 years.

Waiting Period: Pre-existing conditions and/or maternity benefits are subject to a waiting period of 1 to 4 years from the start date of the health insurance plan. On the other hand, a critical illness policy often requires a 90-day waiting period from the policy’s start date.

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Premium Amount: Premiums for standard health insurance are higher because they cover a wider range of situations leading to a bigger premium. Medical insurance for critical illness, on the other hand, only covers particular medical concerns that have been pre-determined hence leading to a lower premium.

Sum Insured: The sum Insured in critical illness insurance is usually higher as compared to the health insurance policy. This is due to the severity of the illness involved. Such sum insured can range up to 50 lakhs.

Diseases Covered: Health insurance plans offer coverage for a variety of situations like accidents, diseases, pre-existing diseases, etc. Some policies also cover maternity-related costs. Critical health insurance is limited for certain specified diseases and those diseases are covered as mentioned by the insurance company.

Other Benefits: Health insurance policies typically feature a variety of perks, including cashless treatments, enhanced coverage possibilities, and coverage for many family members. In critical illness insurance, the policyholder is compensated if he or she is diagnosed with a defined serious illness.

Hence, it is important to determine your condition, priority and requirements before going for a medical policy. Health insurance policies are significantly different from critical illness covers. If you are one suffering from a severe ailment, it is recommended to choose a critical illness policy.

Author Bio –

Smriti Gala works as a Digital Marketing Manager with Coverfox. As her life turned upside down when COVID severely afflicted her family members, Smriti decided to dedicate her expertise towards informing and educating the masses about the importance of health insurance. When she is not actively writing enlightening content, our ‘monk marketer’ likes to meditate, meet new people and explore less travelled territories.

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