Difference between Mediclaim and Health Insurance

It is often seen that people use terms like ‘Mediclaim’ and ‘Health Insurance’ interchangeably during the course of their conversation. Due to similarities between the two, many people assume that they are one and the same. And they are not entirely wrong either. While Mediclaim and Health Insurance do have many things in common in terms of coverage as well as benefits, there are still several differences that separate the former from the latter.

Therefore, in this blog, Secure Cover tries to highlight major differences between Mediclaim and Health Insurance so that readers can take informed decision when it comes to choosing between the two types of insurance plans.

WHAT IS COMMON?

For starters, both Health Insurance and Mediclaim are insurance products that provide cover for health related eventualities in return for a premium. They provide financial support either directly (through cashless service) or indirectly (through reimbursement of amount paid by the client for medical treatment). Moreover, both Mediclaim and health insurance plans have limited validity and thus, have to be renewed from time to time in order to continue availing benefits without interruption.

WHAT’S THE DIFFERENCE?

Despite many similarities in terms of coverage and benefits, Mediclaim and health insurance plans differ from each other in a number of ways. They are as follows:

APPROACH TOWARDS HEALTH CARE

Mediclaim plans are designed to help meet expenses incurred when a person is hospitalized. It takes a reactive approach towards health and is generally confined to providing immediate relief instead of ensuring long term well-being of a person.

Health insurance on the other hand adopts a more holistic approach towards health and includes preventive health care as well as diagnosis related to it in its policy coverage.

COVERAGE

Both Mediclaim & health insurance provide cover for medical emergencies but the latter also has provisions for pre- and post-hospitalization expenses such as ambulance charges, medicines, post hospitalization revisits to the doctor as well as regular health check-ups.

Health insurance plans also provide cover for critical illness due to diseases such as kidney failure, cancer, strokes etc. which Mediclaim plans do not provide. Some health insurance plans also have provision for compensation to the client for any loss of income due to hospitalization.

AMOUNT OF POLICY COVERAGE

As said earlier, since the coverage of Mediclaim plan is limited as compared to health insurance, the total policy amount for it is also less than that of a health insurance plan. A Mediclaim policy can provide cover for expenses upto Rs. 5 Lakhs as sum insured whereas the sum insured in case of health insurance plan may go upto Rs. 6 crores.

REIMBURSEMENT TERMS

Mediclaim pays only the expense that is incurred during hospitalization so a person can make multiple claims for multiple hospitalizations within the policy period until the assured sum gets exhausted. Health insurance on the other hand provides lump sum hence it can be claimed only once.

COSTS AND DISCOUNTS

Although the cost of both Mediclaim and health insurance plans depend on a host of factors such as the age and health status of the policy holder and the total coverage amount, when it comes to getting discount on premium, health insurance buyers are at an advantage as they often get “no-claim bonus” for a succeeding year if the client does not make any claim on account of good health.

The Mediclaim buyers on the other hand do not get such discounts from the Insurance service provider. This does not mean that clients cannot bargain with the insurance service provider at the time of purchase. At times, Mediclaim agents do help clients in getting attractive discounts on policies.

Let’s Wrap it up!

Both Mediclaim and Health Insurance plans have their own advantages. While Mediclaim aims to provide financial help to the insured at the time of medical emergency, Health Insurance takes a holistic approach towards health. While Mediclaim can be beneficial in the short term, Health Insurance plan is beneficial in the long run. The suitability of a health plan depends on a number of factors including cost, coverage and benefits.

Disclaimer: The content of this blog is based on personal research of the writer. Reader’s discretion is advised. Neither Secure Cover nor the writer will be held responsible for any wrongful interpretation of the content of this blog.