Standard Health Policy vs Critical Illness Cover

Standard Health Policy vs Critical Illness Cover: Key Differences Explained


The life in today’s age has become unpredictable with regards to illness gripping many at large. With a life full of managing multiple roles of a child, parent, and spouse to your family, it has become hectic to take adequate care of yourself. Your busy schedule might see little to no time to look after yourself. Along with it, the increasing environmental conditions like pollution make everyone prone to ailments. Treatment for these ailments might burn a hole in your pocket. This is when a health insurance policy comes to the rescue. It helps to alleviate the financial stress of availing the treatment at the right time.

Health insurance plans are available in multiple options ranging from individual health plans, family floater policies to even covering critical illnesses. For new buyers, this can be a perplexing decision as to what should form part of your portfolio. In this article, we help you notice the differences between a standard health policy vis-à-vis critical illness insurance.

Features of the plan: A standard health policy covers the treatment costs incurred for hospitalisation. Expenses like day-care procedures, out-patient department charges, medical check-ups, consultation charges and more are covered under this policy. A critical illness policy, on the other hand, makes a lump sum pay-out when you are diagnosed with the specified illness. Since most of these critical ailments are fatal in their nature, it is beneficial to receive the entire sum assured at the beginning to avail the right treatment and cover the cost of treatment including check-ups and preliminary tests.

Scope of policy: The coverage of both policies differs significantly. A standard health policy includes ambulance cover, pre and post treatment costs apart from the actual medical treatment for a varied list of ailments, a critical illness policy covers only specified ailments listed as per the terms of your policy. Moreover, any pre-existing medical condition is also covered under a standard health cover. The same is not under the scope of a critical illness policy.

Benefits under the policy: A standard health insurance helps reimburse the cost of treatment availed. If your insurance policy offers a cashless facility, you can even avail the treatment at a network hospital without having to worry about upfront payment. These bills are directly settled by the insurance company with the medical facility. In addition, these policy benefits continue to be available till the end of policy tenure or exhaustion of the sum insured, whichever is earlier.

For a critical illness policy, the benefits are available to you, the policyholder, in a lump-sum mode. Here, you can decide how to make use of the available amount on diagnosis of the specified ailment. This policy differs from a standard plan in terms where once you make the claim, the policy expires.

Premium: A standard health policy due to its broad coverage charges a higher premium as compared with a critical illness policy. Although, these premium charges vary according to the policyholder’s age and health conditions. Customising your policy will see a change in the premium too.

Since these policies serve different purposes, it needs a careful evaluation as to what you should purchase. It can help to make the right choice if you compare health insurance plans and then decide based on your coverage requirement which suits you the best.

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