When you plan to invest in a health insurance plan would you just go and purchase the plan directly or would you first find out what the plan has to offer? Obviously the latter, right? It’s always important to check what your plan has to offer before you make any decision. Even when you think of buying a plan from one of the best insurance companies in the country, if you do not know what your plan has to offer, then it’s of absolutely no use at all.
When people buy a health insurance plan they make a lot of mistakes. One of the most common mistakes that people make is assuming that mediclaim is the same as health insurance. Health insurance and mediclaim plans are different. In this article, we will discuss about those differences and what they offer.
Q1. What is Mediclaim Insurance?
Mediclaim Insurance is a type of insurance plan that offers protection against any health-related expenses. It offers you a chance to deal with any health-related emergencies in a systematic manner. However, with this type of insurance policy, the coverage given is limited to only hospitalization, while all other expenses are to be borne by the policyholder.
Features of Mediclaim Insurance Plan
Here are the features of a mediclaim insurance plan.
- Coverage – A mediclaim insurance policy would provide you insurance cover against expenses such as hospitalization, treatment due to specific diseases and accidents.
- Sum Assured – Generally, a mediclaim insurance plan would come with a pre-decided sum assured.
- Premium Affecting Factors – The premium of a mediclaim insurance plan is decided on the basis of the individual’s age, sum insured, geographical location, duration of the plan and gender.
- Claim Settlement – A mediclaim insurance plan can be processed as cashless treatment or reimbursement.
- Plan Basis – One could purchase a medical insurance plan on individual as well as family health cover. A family floater plan would cover self, spouse, dependent parents and dependent children.
- Tax Exemption – With a mediclaim insurance plan, one could claim for tax benefits as per Section 80D of IT Act 1961.
Q2. What is Health Insurance?
A health insurance plan covers the cost of surgical as well as other medical expenses that is incurred by the insured individual. With a health insurance plan, the insured individual would either have to pay the expenses out of pocket and will be reimbursed by the insurer later on, or the insurance company will settle the bill with the hospital directly. The benefits of a health insurance plan is subjected to the terms and conditions of the policy. Most of the times, a health insurance plan is extensive and is more expensive than a mediclaim policy.
Features of a Health Insurance Plan
Coverage – A health insurance plan comes with comprehensive coverage. Some also offer you critical illness cover in cases of heart disease or cancer. Usually, critical illness is not part of a basic health plan, it’s a rider that you could opt for as additional cover.
Renewal Discounts – With a health insurance policy you can also get the benefits at the time of renewal after a claim-free year. This benefit is referred to as No Claim Bonus.
Co-payment – There are also a few health insurance policies that offer you the option of co-payment. This helps minimise the insurance premium. With this type of plan, a certain percentage of treatment expenses will be paid by the insurance company, while the remaining part is paid by the insurer.
Tax Benefits – With a health insurance plan, you can also get tax benefits under Section 80D of the income tax Act.
Now, let’s take a look at the difference between health insurance plan and Mediclaim policy.
| Basis | Mediclaim | Health Insurance |
| 1. Offered Coverage | A mediclaim plan offers coverage only for hospitalization, accident treatment and pre-decided diseases that will be given for a pre-specified limit. | A health insurance plan provides comprehensive coverage against pre-hospitalization expenses, hospitalization expenses, ambulance and post-hospitalization expenses. |
| 2. Add-on | Add-on covers are not offered with a mediclaim policy | Health insurance plans come with add-on coverage in order to enhance your insurance coverage. It offers accident coverage, critical illness coverage, maternity coverage, accidental disability coverage and more. |
| 3. Flexibility | A mediclaim policy offers no flexibility | With a health insurance plan you get the flexibility, where you can reduce your health insurance premium after a specified time period. You can even go ahead and change your policy duration as well. |
| 4. Plan Features | Plan features of a mediclaim policy will differ from one provider to another. | The features and benefits of a health insurance plan will generally remain the same. |
| 5. Critical Illness Cover | A mediclaim Policy does not provide cover against critical illnesses. | Health insurance plans provide cover for more than 30 plus critical illnesses such as heart diseases, cancer, stroke, kidney failure, etc. |
| 6. Sum Assured | With a mediclaim insurance plan the sum assured will exceed 5 lakh rupees. | With a health insurance plan the sum assured will not exceed 6 crore rupees per year. |
| 7. Claims | In a mediclaim insurance plan, you can file for claims until the total amount that is assured is totally exhausted. | In a health insurance plan when there are claims that’s related to accidental disability coverage or critical illness, the assured sum will be paid in lump sum. Therefore, you can make such claims only once during the policy tenure or policy duration. Other than that, you can file for claims as long as your sum insured isn’t exhausted. |
| 8. Hospitalization | For you to avail your mediclaim benefits, it is necessary that you get hospitalized. | For you to avail your health insurance benefits, it is not necessary that you get hospitalized. |
Now that you know the difference between a health insurance and mediclaim plan, it will definitely help you make better decisions whenever you decide to buy an insurance plan. But, before you invest in any such plan, it’s important to analyse your expectations and compare the cost and benefits before you make your decision.
