Mediclaim vs Health Insurance

Difference Between Health Insurance and Mediclaim

Mediclaim vs Health Insurance is a common confusion among people. Mediclaim policies are usually cheaper than health insurance policies, making them an affordable option. However, health insurance provides wider coverage and a higher sum insured. Moreover, health insurance offers add-on coverage and tax benefits. Many people often wonder about the difference between health insurance and mediclaim, as both serve similar purposes but have distinct features.

Health Insurance vs Mediclaim is an ongoing debate in the health finance sector. They both play significant roles in safeguarding people’s health in India. As medical costs surge, investing in one becomes crucial and necessary. Although people often use these terms interchangeably, they offer distinct benefits. While a mediclaim policy primarily focuses on hospitalisation costs, health insurance goes beyond that. If you’re asking which is better, mediclaim or health insurance, the answer depends on your healthcare needs and budget. In simple terms, the difference between mediclaim and health insurance often comes down to how wide the coverage is and how many extra benefits you get beyond hospital bills.

Here we will discuss the Mediclaim vs health insurance difference and help you choose the right one.

Why People Compare Mediclaim vs Health Insurance

Many buyers search for mediclaim vs health insurance when they want a plan that fits both their budget and medical needs. Understanding what each option typically includes helps you avoid paying for features you may not use.

What is a Mediclaim Insurance Policy?

Mediclaim insurance policy is a type of health insurance that reimburses the policyholder for costs incurred in treating an illness. Usually, you have to submit your hospital bills to get your payment. However, you can also opt for a cashless feature, where the insurance company will directly pay the hospital.

What is a Health Insurance Policy?

A health insurance policy includes comprehensive coverage for treating an illness. This could be hospital bills or additional charges required for treatment. The benefits that you get depend on the policy’s inclusion and exclusion. Insurance companies generally reimburse the policyholder. However, one can also opt for direct bill settlement with the hospital.

If you want straightforward support mainly around hospital bills, mediclaim can feel like a simple starting point. But if you prefer broader support for different treatment-related expenses and optional upgrades, health insurance is usually designed to handle more situations.

Mediclaim and Health Insurance - Know the Difference

When comparing health insurance vs mediclaim, it’s important to understand coverage limits and flexibility, let us compare them in the following mediclaim vs health insurance table:

5 Things that Make Health Insurance Better than Mediclaim

Mediclaim and health insurance are both beneficial for your savings. However, medical insurance offers much more comprehensive coverage in the face of adversity. Here are 5 ways a health insurance policy provides greater benefits than mediclaim:

Higher Sum Insured

Sum insured refers to the maximum amount your insurance provider will pay in one policy year. Health insurance companies allow a sum insured amount of Rs. 5 lakh to Rs. 2 crore in India. However, this depends on the specific policy and individual contributions.

A higher sum insured amount allows you to be stress-free in the event of a major surgery or illness. If you’re covering more than one person, a family floater health insurance plan can be a practical way to share one larger sum insured across family members.

Wider Coverage

Unlike mediclaim, a health insurance policy offers wide coverage, including pre-hospitalisation, ambulance charges, post-hospitalisation and other associated costs. Mediclaim, on the other hand, usually only covers inpatient hospitalisation costs. Although it is beneficial for smaller treatments, emergencies, and critical illness, call for comprehensive coverage.

Watch Out for Common Caps and Limits

While comparing health insurance vs mediclaim, also check if the plan has limits on room rent, ICU charges, or specific procedures. These small clauses can make a big difference to your final out-of-pocket spend during a claim.

Tax Benefits with Flexibility

According to the Income Tax Act of 1960, you can claim tax deduction on health insurance premiums. Self-claim is limited to Rs. 25000, while claims for spouse, children, and family members, along with self, can reach Rs. 50000.

For senior citizens, the maximum deduction limit is Rs. 50000. Moreover, under Section 80D of the Income Tax Act, 1960, preventative health checkups and medical expenses for senior citizens are also claimable.

Add-on Benefits

Health insurance allows add-on or top-up options. This provides you with a customisable plan, unlike the one-size-fits-all approach of mediclaim. Under health insurance, you can add the following:

1. Critical illness cover
2. Maternity benefit cover
3. Outpatient department (OPD) cover

This makes health insurance plans much more flexible and comes to your aid when life throws unexpected hurdles along your way.

Cashless Network Hospitals

Health insurance companies offer more than 14,000 cashless hospitals in their network. This opens up the scope for accessing the best healthcare across states. Mediclaim, on the other hand, does not offer a wide network of cashless hospitalisations. This limited access can hamper you in times of need and is a critical factor in differentiating mediclaim policy vs health insurance.

Points to Remember Before Buying a Health Insurance or Mediclaim Insurance Plan in India

Whether it is your first time buying insurance or you have previous experience with it, keeping in mind the following points will help you choose the right one:

 Quick checklist before you buy:

• Check the network hospitals for cashless treatment in your city
• Read the waiting period for pre-existing conditions
• Look for any co-payment clause (especially for seniors)
• Confirm the pre- and post-hospitalisation day limits
• Understand the claim steps for cashless vs reimbursement

Claim Settlement Ratio (CSR)

This refers to how many claims your insurance provider has settled. Having a high claim settlement ratio ensures that your insurer is legitimate. Check for previous customer reviews and experiences.

No Claim Bonus

No claim bonus refers to a discount which your insurer gives you for the years you have not claimed any settlement. Therefore, when you renew your policy, your basic coverage amount increases. The higher the percentage of NCB, the more you benefit. Always ask whether your policy offers this benefit.

Waiting Period

Waiting periods generally range from 24-36 months. During this time, insurance providers usually do not accept any claims for diseases such as high blood pressure, thyroid, or diabetes. Also remember that health insurance portability may allow you to switch insurers later without losing continuity benefits, as long as you follow the portability rules.

Choose an insurance provider with the lowest waiting period for maximum benefits.

Final Thoughts

Knowing the difference between mediclaim vs health insurance is necessary to evaluate your health finance needs. While both offer their share of advantages, health insurance is a better choice if you and your family members suffer from various diseases. Take charge of your health today and invest in a health insurance policy!

Eventually, the choice in the mediclaim vs health insurance comparison completely depends on the individual's budget, health profile, and the level of coverage they look for, comprehensive protection.

While evaluating Mediclaim vs Health Insurance, keep in mind that mediclaim acts as basic protection for hospitalisation, but an adequate health insurance gives a safety net for a wider range of medical expenses. However, carefully assessing your Mediclaim vs Health Insurance needs on the basis of your family’s needs and medical history will lead you to the most responsible choice for long-term security.

Also Read:

→ What Is the Co Payment Percentage for Dependent Parents Under the Mediclaim Policy

→ Which mediclaim is best for a family

→ Which mediclaim policy is best for senior citizens above 60