Having a health insurance plan or mediclaim in these uncertain times is of utmost significance. Buying an insurance policy for yourself or your loved ones is one of the most responsible decisions that you can ever take. These plans keep you financially secure in unforeseen times like urgent hospitalisation, critical surgery, and so on. But how many of you know that a medical plan is different from a health insurance policy? Well, most policyholders use both terms interchangeably. But there are certain differences that one should know so as to reap the most out of these policies. This blog discusses the differences between a health insurance plan and a medical plan in detail so that you can make a smart and well-informed decision.
What Is Health Insurance and Medical Plan?
A health insurance plan is basically a policy that gives you coverage against surgical and medical expenses. The policyholder can either opt for cashless claim or reimbursement claim. Health insurance plans tend to be on the pricier side as they offer coverages that extend beyond hospitalisation as well. On the other hand, a medical plan is a budget-friendly policy that offers financial protection against different types of health issues. A mediclaim always offers limited coverage for specific health emergencies.
Difference Between a Health Insurance Policy and Medical Plan
| Basis of difference | Mediclaim | Health insurance |
| Coverage | If you have a medical plan, know that you will enjoy coverage only in cases of accident-related treatments, hospitalisation, pre-existing diseases, and that too upto a pre-specified limit. | A health insurance policy brings in comprehensive coverage for medical conditions related to pre and post-hospitalisation charges, hospitalisation expenses, ambulance expenditure, and so on. Also, the policyholder can expect compensation in case there has been a loss of income because of accidental injury. |
| Flexibility | There is zero flexibility in terms of coverage offered. | A policyholder can easily increase or decrease the limit of the coverage. Even the premium amount can be changed by tweaking the duration of the policy. |
| Add-on covers | You will get no add-on covers with a mediclaim. | Multiple add-on covers are available which help in enhancing the coverage such as maternity cover, critical illness cover, personal accident cover, and so on. |
| Number of claims | The policyholder has the right to file multiple claims as long as the insured amount does not get over. | One can raise a claim multiple times till the insured amount is not over yet. However, claims related to accidental disability and critical illnesses are always paid in lump sum. So, you can file the claim only once in such cases. |
| Critical illness cover | A medical plan never offers financial coverage against critical illnesses. | You will get coverage against thirty critical health conditions like stroke, cancer, kidney failure, etc. |
| Sum insured | Generally, the maximum amount of sum insured is around INR 5 lakhs. | The sum insured ranges between INR 50,000 to INR 6 crores. |
| Hospitalisation | If you wish to avail the benefits of your medical plan, you need to get hospitalised first. | There are multiple benefits that you can enjoy even if you are not hospitalised. For instance day care procedures, pre and post hospitalisation care, etc. |
Factors You Should Consider Before Buying Health Insurance or Mediclaim
- Claim settlement: Always keep in mind whether you wish to opt for a cashless claim or a reimbursed one.
- Sum Insured: Check about the pre-decided sum insured that comes with different plans.
- Premium affecting factors: Keep a tab on the factors that affect the amount of premium, such as gender of the insured, sum insured, age of the insured, geographical location, and so on.
- Plan basis: Health insurance plans and mediclaims can either be purchased on an individual basis or a family floater basis. The family floater plans offer coverage for spouses, self, parents, and dependent children.
- Renewal discounts: If you have not raised any claim for the entire year, then you are entitled to a No Claim Bonus. This NCB can be quite beneficial in bringing down the renewal premiums.
- Tax exemption: Health insurance plans offer tax benefits on the premium you pay based on Section 80D as per the IT Act 1961.
- Co-payment: Check whether your plan comes with a co-payment or not. If there is a co-payment, it can help you bring down the amount of payable premium.
Health Insurance or Medical Plan - Which One Is Better?
In order to make a choice between a health insurance plan and a medical plan, you have to take multiple factors into consideration, such as-
- Your budget
- Whether or not you can pay a high premium
- Whether or not you require a flexible plan
- Long term or short term planning
- Age, life stage and medical condition of the insured
- Health issues faced by the insured
- Whether or not you require add-on covers
In a Nutshell!
Now that you know the difference between a mediclaim and a health insurance policy, you can proceed with caution and choose the one that caters to your budget as well as health requirements. It is always better to make a well-informed decision and stay prepared so that you are not taken in for any surprises when you file the claim. Knowing your plan inside out will help you get your claim approved and settled on time.
