Critical Illness and Health Insurance: A Simple Comparison
Understand the difference between critical illness insurance and regular health insurance because it can save you a lot of stress (and money) down the road. Think of it this way: they're both on your healthcare dream team, but they play different positions.
Understanding the features of critical illness insurance vs health insurance is key to building a rock-solid plan that protects your health and your bank account. Ready to get smart about your health coverage? Dive in.
What Is Critical Illness Insurance?
Critical illness refers to a severe disease or health condition which can be threatening to your life. To recover from them, extensive medical treatment is usually a must. The cost of treating such conditions is generally high, which may leave your finances weighed down.
A standard or normal health insurance policy can offer financial protection to some level, but it may not be enough to cover all expenses. This includes costs related to repeated hospital admissions, frequent consultations with medical specialists, and ongoing diagnostic tests or screenings.
In such cases, you will need a lump sum amount that can provide essential financial relief. A Critical Illness Health Insurance plan can help you with that. It provides a substantial amount of payout if the illness is included in the policy's terms and conditions.
How Does Health Insurance Work?
Under a health policy, you pay a premium to an insurance company. In return, the company will cover part or all of your medical expenses. The coverage usually depends on the type of policy you select. For instance, a critical health insurance policy will cover more than a regular policy.
Both kind of policies usually covers the following:
You can either get cashless treatment at network hospitals or reimburse the expenses later. The insurer pays up to the sum insured as per certain conditions, limits, and exclusions.
Critical Illness vs Health Insurance: Key Differences
Even though both policies are meant for financial coverage, there are some major differences between health insurance and critical illness insurance. Critical insurance is more extensive in nature in terms of coverage compared to regular health insurance.
Here’s the health insurance comparison for a better understanding:
| Features | Regular Health Insurance | Critical Illness Cover |
|---|---|---|
| What it covers | Covers hospital stays, treatments, accidents, and some diseases | Covers only serious illnesses like cancer, heart attack, etc. |
| Payout type | Pays actual hospital bills | Pays a substantial amount on diagnosis |
| Premium cost | Based on coverage amount, number of people covered, and policy features | Based on how many illnesses it covers and the sum assured |
| Waiting time | 0 days to 3 years (based on pre-existing illness, age, and other factors) | 90 days from the policy start date |
| How long does it last | Active till the usage of the coverage amount or the policy expires | Active until you claim it or the policy expires |
Why Both Policies Are Essential
Health insurance and critical illness coverage serve different purposes, which is why having both can give you complete protection. Health Insurance will help you pay for regular medical treatments. This means taking care of day-to-day costs and emergencies.
On the other hand, a Critical Illness Plan provides coverage for illnesses like cancer, stroke, or heart disease. You can use the money received as a payout from this plan for treatment, recovery, or even daily expenses if you can't work due to the illness.
Having both means:
Tips for Choosing the Right Policy
Selecting the right health insurance and critical illness cover depends on your personal requirements. Here are a few things to keep in mind when choosing a policy:
Frequently Asked Questions
1. What does critical illness insurance cover?
Critical health insurance policy covers the expenses of life-threatening diseases like cancer, kidney failure, heart attack, etc.
2. How is a critical illness policy different from health insurance?
A regular health insurance plan mainly covers your hospitalisation and daycare expenses. On the other hand, if you are diagnosed with a critical illness listed in a critical illness cover policy, the insurer pays you a significant amount.
3. Can I have both critical illness and health insurance?
Yes, you can have both. In fact, it is ideal to have both as they can cover all sorts of medical expenses. This will be particularly helpful if you are the breadwinner of the family.
4. How do I choose the right policy for my needs?
If you are above 40 years old, have a history of a critical medical condition, or are the sole earner of the family, then a critical illness cover may be suitable. On the other hand, regular health insurance will cover your regular hospital bills. The final choice depends on your requirements and conditions.