Difference between Mediclaim and Health Insurance


How is Health Insurance Different from Mediclaim Policy?

One of the most common mistakes a person believes is mediclaim and health insurance policies are alike. It’s high time to address the issue, but before that let’s understand what health insurance and mediclaim are.

Mediclaim policy is a type of health cover that offers coverage for expenses, incurred by a person during a medical emergency, including domiciliary care and hospitalization expenses due to illness, surgery or accident. The policy may offer two kinds of claim facility namely.

On the other hand, health insurance policy is a comprehensive health cover for emergency medical and surgical expenses beyond basic hospitalization. The expenses can include Ambulance costs, Pre and Post-hospitalisation expenses, Daycare treatments, OPD expenses, Critical Illnesses, and much more. Such policies too offer cashless claim facility and reimbursement of expenses when the insured pays for medical bills from his/her pocket.

To summarise, a Mediclaim policy limits itself to just the hospital or nursing home dues whereas General Health insurance is an all-inclusive insurance policy that can cover much more.

Mediclaim Vs Health Insurance

Here are a few main points of comparison between health insurance and Mediclaim policy:

Factors Mediclaim Health Insurance
Basic Definition Mediclaim is a type of insurance that covers only hospitalization-related expenses for a specified time limit Health insurance is a type of insurance that provides comprehensive coverage for medical costs and surgical expenses beyond basic hospitalization
Coverage Offers cover for domiciliary care and hospitalization expenses incurred due to an accident, surgery or illness Offers all-inclusive coverage for various expenses like Ambulance, Pre and Post-Hospitalization, Diagnostic Tests, Day Care Treatments, OPD Expenses, Critical Illnesses, Maternity Expenses, Alternative Treatment, etc.
Add-on cover Hospitalization does not offer any add-on cover. Health plans provide add-on cover for various medical conditions like diabetes, hypertension and also for maternity
Features Main characteristics of a Mediclaim policy might vary from one insurance provider to the other Benefits and advantages by general health insurance plan remain the same over most health insurance providers
Sum Assured The sum assured for hospitalization is restricted to five lakhs only The sum assured for medical expenses can go unto six crores, per year. The amount is based on factors like the age of the policyholder, city he/she lives in and members insured
Claims A Mediclaim policyholder has the right to file claims until the total amount is completely exhausted In some health insurance plans like critical illness cover, the sum insured must be paid in lump sum and claims can be made only once during the entire policy duration. For most of the plans, claims can be made until the total amount is completely exhausted.
Cover for Hospitalisation To avail the benefits of Mediclaim, it is necessary for the insured person to be actually hospitalized To avail the benefits of health insurance plans, the insured person need not be actually hospitalized. He/she can avail benefits like daycare, regular check-ups, pre-natal expenses, etc.
Flexibility With limited coverage, mediclaim policies are not considered as flexible policies, but they are highly beneficial when it comes to cover for hospitalization Health insurance policies are highly flexible as it gives policyholders the option to customize their plans like selecting the preferred sum assured amount

How Does Health Insurance Score Over Mediclaim Policies

Mediclaim policies are often very restrictive but can come in handy during emergencies like hospitalization due to accidents or ailment. However, since health insurance offers 360-degree coverage, most experts recommend having a Health insurance plan. Such plans are designed to keep all the healthcare requirements of an individual in mind. It accommodates coverage from the very start of any health issue. A health plan has many added benefits and features, some of which are listed below.

  • Pre-Hospitalization involving OPD care such as doctor consultations, diagnostic tests, and pharmacy.
  • Global Coverage for planned hospitalization with the option of cashless hospitalization for specified illnesses from a medical facility abroad.
  • Cover for alternative treatments such as Ayurveda and Homoeopathy (AYUSH).
  • Annual Health Check-ups which every insured member can avail once.
  • No claims bonus for policyholders who do not claim in a policy year. A 10% increase in Sum-Insured for 5 years is offered with a maximum increase of 50% in 5 claim-free years.
  • Automatic Recharge of Sum Insured once it gets exhausted in a policy year so that one never runs out of coverage. This is at no extra cost and technically the insured gets double sum insured for the same premium.
  • Daily hospital cash allowance involves additional coverage like food and hospital visits.
  • Cover for surgery costs for organ transplants as an add-on, either in full or in partial amounts.
  • Lifelong renewability. Once enrolled an insured can stay covered for a lifetime as long as they timely renew their policy every year.
  • In-built maternity cover feature, with a waiting period of nine months, for both prenatal and postnatal expenses. Some policies also extend coverage for newborns from birth up to ninety days.
  • Cost cover for ambulance and day-care treatments in which hospitalization is less than 24 hours
  • Add-on covers with the choice to enhance/upgrade policy coverage by paying a very small amount.
  • Coverage for loss of income due to an accident.

Insurance suppositions can be different from one another. An insurance plan that works for one family might not work for another. For this very purpose, there are a wide range of plans that can be tailored to suit different people with different medical backgrounds.

Care Health Insurance (Formerly Religare Health Insurance) resolves to offer a solution for customers from all walks of life. Their comprehensive Health Insurance - Care offers the aforementioned benefits and in addition comes with features like Automatic Recharge of Sum Insured, Annual Health Check-up for all Insured Members, No-claim bonus and Air Ambulance Cover. All of this with a service commitment of just 2 hours for cashless claim approval.

Cashless Mediclaim Policy for Family in India

Health Insurance offers its customers two claim settlement options - reimbursement and cashless. Policyholders can avail cashless treatment across any hospital empaneled in their network. Simply put, a cashless Mediclaim policy is one where the expenses are directly settled with the healthcare institution, subject to policy terms and conditions. This is done, to minimize the direct financial load on that particular individual at the time of hospitalization. For the customer, this is highly convenient. For a hassle-free experience, one should intimate the insurer post-admission within the specified time period which is 24 hours in case of emergency hospitalisation. Apart from this, one should read all key policy terms and conditions and keep their health card handy as it must be presented in the hospital.

However, if an individual at the time of emergency wishes to go-ahead with their treatment in a hospital of their choice and which is not in the insurance company's list - they can still claim. In this case, they will have to bear the hospital expenses from their own pocket and file for reimbursement after getting discharged.

Things that Separate Mediclaim from Health Insurance

Mediclaim usually provides coverage against hospital bills, treatment expenses that occur during accidents and a list of specific diseases. Typically, there are often three types of exclusions in a Mediclaim insurance plan:

  • Permanent (diseases that are not covered at all)
  • Temporary (diseases that are covered after a specific time period is covered)
  • Limited (diseases covered within the policy with a cap on the payout)

Usually, Mediclaim policies cover dental-only if it mandates a minimum of 24 hours of hospitalization.

These days there are options also to have a mediclaim policy to suit senior citizens. The age for a senior citizen to apply is between sixty-one to sixty-nine years. The premium for the Mediclaim for senior citizens is usually high. Some policies also offer coverage for alternative medical treatment methods.

How Does Mediclaim and Health Insurance in India Work?

Mediclaim policies are extremely beneficial when it comes to meeting hospitalization expenses. The following features are unique to a Mediclaim policy and define the way it works in India.

  • Cover Offered: Mediclaim policies offer specific coverage such as hospitalization expenses cover and cost cover for accident-related treatment and certain diseases.
  • Group Mediclaim: Just like Health Insurance, a Mediclaim policy also offers a family health insurance plan which means one could cover multiple family members like parents, spouses, and children in a single policy. A Group Mediclaim is a type of Mediclaim policy wherein the coverage is extended to a group of people, for example, employees of an organization.
  • Premium and Sum Insured: Mediclaim policies have usually a predefined sum insured. The policy premium is calculated on the basis of factors like sum insured, gender, proposer’s age, treatment location, and policy duration.
  • Claim: The claim settlement is generally in the form of reimbursement of the hospitalization expenses by the insurance company.
  • Tax Advantages: Such plans offer a tax rebate on the premium paid under section 80D of the Income Tax Act.

Health insurance plans are the most widely preferred insurance plans in India owing to the comprehensive nature of coverage offered by them. Listed below are some exclusive features that explain how they work in India:

  • Cover Offered: Health policies offer complete coverage for various medical exigencies such as critical illness, pre-existing diseases, etc.
  • Family Cover: Family floater plans offer health insurance coverage for the entire family parents, spouse and children.
  • Tax Benefits: Health insurance buyers can get tax deductions under section 80D of the Income Tax Act on the premium they pay for a policy.
  • Cashless Hospitalisation: This feature enables an insured person to avail cashless Mediclaim treatment in any of the network hospitals of the insurer, thus providing a high level of convenience.
  • Co-payment Option: Some senior citizen health insurance plans have a co-payment option which requires the policyholder to bear some percentage of the medical costs. Buyers can look forward to lower premiums.
  • Discounts and no-claim bonus: Health plans bring a variety of additional benefits generally offered during policy renewal in the form of premium discounts and higher sum insured as a bonus for having a claim-free year.

Benefits of Mediclaim and Health Insurance in India

The biggest benefit of mediclaim policies is the instant cashless coverage a person receives during hospitalization. This option is available for both planned and emergency hospitalization. There is also the option of reimbursement of expenses available for mediclaim policyholders. Getting quality medical care in private hospitals has become expensive, nowadays. Mediclaim policies are the best health cover one can buy to safeguard unexpected hospitalization costs that may arise due to sudden injuries, accident or illnesses.

Health insurance plans, on the other hand, are excellent choices for people who wish to safeguard their finances from various kinds of medical expenses, not just hospitalization. The benefits of health plans include comprehensive health coverage including pre and post hospitalization, add-on covers and customized plans for senior citizens, maternity and critical illness. Cashless health insurance is another benefit wherein the insured person can avail of quality and timely treatment in any of the network hospitals of the insurer. However, just like mediclaim policies, there is also the facility for reimbursement of medical expenses.

Take Away

It might be confusing when deciding between buying a mediclaim and opting for a health insurance policy. The best way to know which health coverage is best for you and your family is to assess healthcare needs. Some factors to keep in mind include one’s financial situation and the coverage amount required, any ailment you or a family member may be suffering from, age, lifestyle, etc. Usually, a mediclaim policy works best if you are looking for good hospitalization cover that will help you in times of a medical emergency. However, if you have a family comprising of a spouse, dependent children and parents, it is advisable to go for a family floater health insurance that has numerous advantages that offer much more than hospitalization cover..