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Difference between Mediclaim and Health Insurance

Have you ever bought a mediclaim policy and end up wondering, is it any different from health insurance? These two terms are too often used interchangeably. However, there are some sharp differences between them. While mediclaim limits itself specifically to hospitalization expenses, a health insurance is much more comprehensive and provides a cover that extends beyond hospitalization. Let's look at the detailed differences between Mediclaim and Health Insurance.


Health Insurance

Mediclaim pertains specifically to hospitalization. Simply put, it covers only hospital related expenses.

For filing a mediclaim, hospitalization is required.

The cover given is limited. The upper cap on the sum insured does not exceed 5 lakh in a typical mediclaim policy.

Health insurance is more comprehensive and covers not only hospitalization expenses but also pre and post hospitalization expenses, ambulance charges, compensation for the lost income and more.

For filing a health insurance claim, an eventuality is required which might not necessarily be hospitalization. For instance for a critical illness cover, all the insured needs to get the sum assured is a diagnosis.

The cover given is quite extensive. The upper cap on the sum insured can go up to Rs 60 lakh.

Mediclaim works on indemnity principle wherein the hospitalization expenses incurred by the insured are reimbursed to him, thus making up for his loss.

E.g. Gaurav owns a mediclaim policy. Last month, he was severely infected so he was hospitalized for 2 days.The total medical expenses he had to incur turned out to be Rs 60,000. He filed a claim and his insurance company paid out Rs 60,000 to him.

There are many components in a health insurance. Health insurance riders such as critical illness rider and accidental disability rider works on benefit principle wherein a lump sum is paid to the insured in case of an eventuality, rather than making up for the loss.

E.g. Gaurav owns a health insurance plan with critical illness cover (1 lakh sum assured). Last month, he was diagnosed with cancer. He filed a claim and his insurance company paid out the total sum assured to him.

Mediclaim allows the insured to make 'n' number of claims until the sum insured is exhausted.

In the critical illness cover, personal accident cover and accidental disability cover, the entire sum assured is paid out at once. Hence, there's no question of making another claim during that policy tenure.