Mediclaim vs Health Insurance: Which Should You Buy?

What is Mediclaim Insurance?

Medical insurance is a policy that provides financial protection during the insured's hospitalisation. Typically, a mediclaim plan is designed to reimburse the insured for hospitalisation expenses. This can include room charges, medications, doctor fees, etc.

Under mediclaim insurance, the coverage is usually limited to the hospitalisation expenses. Since coverage is limited, many prefer a mediclaim policy, as the costs are lower.

What Are the Benefits of Mediclaim Insurance?

Although the coverage under mediclaim might be limited, there are still several benefits.

Financial Protection Against Medical Needs

Mediclaim insurance is a simple yet effective way to build a financial safety net against medical needs. Several policies offer a high sum insured that can cover the cost of hospitalisation, medical treatments, surgeries, and more.

Tax Benefits Against Premium

The premiums you pay for a mediclaim policy also offer tax benefits. Section 80D of the Income Tax Act, 1961, provides tax benefits of up to ₹25,000.

Affordable Policies for Everyone

Mediclaim insurance is an affordable way to build financial protection for medical needs. The coverage is limited to hospitalisation, but the premiums are usually lower than those for a health insurance policy.

What is Health Insurance?

Health insurance is a comprehensive policy that provides broad coverage for medical needs. Unlike a mediclaim policy, a health plan provides wider coverage for in-hospital expenses, pre- and post-hospitalisation, preventive care, outpatient treatment, and more. Additionally, health policies usually come with modern features, such as add-on covers, that help build comprehensive coverage for the varied medical needs of the insured.

A health plan serves as a formal agreement between the insured and the insurer. Here, the insurer promises to provide wholesome coverage to the insured in exchange for premiums.

What Are the Benefits of Health Insurance?

Health insurance has several benefits that make it a popular choice for many, such as:

Wholesome Medical Coverage

A health insurance plan is built to provide wholesome medical coverage. The insured can get coverage for pre- and post-hospitalisation expenses, diagnostics and tests, maternity benefits, outpatient treatments, and a lot more.

An Option to Customise Coverage

Health insurance policies allow customisation of coverage through several add-ons. Add-ons are additional coverage options the policyholder can add to an existing policy to enhance coverage. Some common add-ons include a zero waiting period, a critical illness rider, a daily allowance, and OPD cover.

Wide Range of Options to Choose From

Usually, insurance companies offer a wider range of health insurance options than mediclaim plans. This ensures that you can get coverage for specific medical needs at an affordable price.

Multiple Financial Benefits

Health insurance policies offer multiple financial benefits, including a high sum insured, tax benefits under section 80D, affordable add-ons for enhanced coverage, and more.

Differences Between Mediclaim and Health Insurance

Take a look at this table highlighting the key differences between mediclaim and health insurance.

Mediclaim or Health Insurance? Factors to Consider Before Deciding

Choosing between mediclaim and health insurance can be confusing. Here are some factors that can help you make a better decision.

Your Medical Needs

Assess your medical needs to determine whether a medical or health plan will better serve you. For instance, if you are looking for financial protection against hospitalisation expenses, a mediclaim is worth exploring, whereas for a wholesome medical coverage, a health plan works better.

The Budget and Affordability

Consider your budget and the policy's affordability. Whether it is a mediclaim or health plan, it should not become a financial burden, but rather a financial safety net for the future that you can easily build.

Coverage Duration You Need

Understand whether you need coverage for short-term or long-term needs. Typically, mediclaim insurance works better for short-term coverage, whereas health insurance is better for long-term coverage due to its easy renewability and policy term.

To Sum Up

Choosing between a mediclaim policy and a health insurance plan entirely depends on your specific needs. Now that you have understood the benefits of both types of policies, you can easily make an informed decision. Just remember that medical policy primarily covers hospitalisation and is a cost-effective option, whereas health insurance offers comprehensive coverage for a range of medical needs.

Generally, as a young, healthy individual, you may want to opt for a basic mediclaim policy that covers emergency hospitalisation. For people over 35 or with medical issues, buying a comprehensive health insurance policy may be a better financial decision.

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