Health Insurance vs Mediclaim: Know the Difference

While buying health insurance, people make various mistakes. One of the most common mistakes is assuming that mediclaim is a synonym of health insurance. When in reality, mediclaim and health insurance plans are quite different from each other. In this article, we will tell you all about how mediclaim is different from health insurance.

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      What is Mediclaim Insurance?

      Mediclaim insurance is a type of insurance plan that offers specified financial protection against health-related expenses. It is a pocket-friendly way to mitigate any health-related emergency. However, the mediclaim insurance coverage is limited to hospitalization and other medical expenses are to be borne by the insured.

       

      What is Health Insurance?

      Health insurance covers the cost of medical and surgical expenses incurred by the insured. The policyholder either has to pay for such expenses out-of-pocket and is later reimbursed by the insurer or the insurance company settles the bill directly with the network hospital. The coverage, most of the time, are more extensive than hospitalization expenses and thus, is usually more expensive than a mediclaim policy.

      What is the Difference Between Mediclaim Insurance and Health Insurance?

      Let’s understand how health insurance is different from mediclaim insurance with the help of the following table:

      Basis

      Mediclaim

      Health insurance

      Offered Coverage

      A mediclaim plan provides coverage only for hospitalization, accident-related treatment and pre-existing diseases up to a pre-specified limit. 

      A health insurance plan offers comprehensive medical coverage against hospitalization charges, pre-hospitalization charges, post-hospitalization charges, ambulance expenses, etc. Additionally, it offers compensation in case of loss of income as a result of an accident.

      Add-on Covers

      It doesn’t offer any add-on cover.

      It may offer multiple add-on covers, including critical illness cover, personal accident cover, maternity cover, etc.

      Flexibility

      When it comes to coverage, it offers no flexibility. 

      health insurance plan offers flexibility to enhance or reduce the coverage. Policyholders can reduce their health insurance premium amount after a specified period by changing their policy duration. For instance, long-term policies offer discounts on premiums.

      Critical Illness Cover

      It does not provide coverage for critical illnesses.

      It provides coverage for more than 30 critical diseases, such as cancer, stroke, kidney failure, etc. depending on the policy.

      Sum Insured

      Mostly, the sum insured for a mediclaim insurance plan doesn’t exceed Rs 5 lakh.

       

      The sum insured for health insurance plans may vary from Rs 50,000 to up to Rs 6 crore per year.

      Claims

      Under a mediclaim plan, a policyholder can file multiple claims until the total amount insured amount is exhausted.

      In health insurance, an insured can file claims as long as his/her sum insured isn’t exhausted. But when claims related to critical illness/ accidental disability cover arises, the assured sum is paid in a lump sum. Such claims can only be made once during the entire policy tenure.

      Hospitalization

      In order to avail mediclaim benefits, it is necessary that the insured gets hospitalized.

      In order to avail health insurance benefits, it is not necessary for the insured to get hospitalized. Benefits like day care procedure cover can be availed without getting hospitalized.

      Now that you know the thin difference between a mediclaim plan and a health insurance plan, you can make an informed insurance decision.

      *All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard T&C apply.

      Things to Know Before Buying a Mediclaim/ Health Insurance Plan in India

      Here are some things that you must keep in mind before buying a mediclaim or health insurance plan:

      • Sum Insured -Generally, the plan comes with a pre-decided sum insured that cannot be changed before renewal.
      • Premium Affecting Factors– The plan’s premium is formulated on the basis of the sum insured, the insured’s age, gender, geographical location and opted duration of the
      • Claim Settlement -The claim request is processed in the form of reimbursement as well as cashless treatment.
      • Plan Basis -The plan can be purchased on an individual as well as a family floater basis. A family floater plan mostly covers self, spouse, dependent children, and dependent parents.
      • Tax Exemption -The plan offers tax benefits on paid premiums as per Section 80D of the IT Act 1961.
      • Renewal Discounts- Generally, health insurance comes with a No Claim Bonus benefit at the time of policy renewal after the end of every claim-free year. This benefit can help to reduce the renewal premiums.
      • Co-payment– Some plans may come with a co-payment. It helps to decrease the insurance premium as a fixed percentage of the treatment expense is paid by the insured and the remaining amount is paid by the insurance company.

      Should You Buy a Mediclaim Policy or Health Insurance in India?

      While both mediclaim and health insurance plans offer tax benefits under Section 80D of the Income Tax Act, insurance experts recommend going for a health insurance plan. This is because health plans offer comprehensive insurance coverage. But before you choose the best health insurance plan, search for the health insurance company with the best services in India.

      However, there is no ‘best’ insurance company or best mediclaim plan for all. Insurance expectations are individualistic and one plan cannot fulfil the health requirements of everybody. Similarly, one insurance company may make one buyer happy while falling short of the mark for another. That’s why, you must compare various health insurance plans offered by different companies based on their coverage, services, benefits and premium.

      Final Words

      Mediclaim insurance and health insurance are two different instruments of mitigating health-related risks. Both exist to fulfil the insurance needs of the buyers. Now that you know the difference between a mediclaim plan and a health insurance plan, you will be able to choose the one that suits you better. But before you buy a health insurance plan, analyze your insurance expectations and compare various insurance plans that fulfil your insurance requirements.


      *All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard T&C apply.

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