Critical Illness Insurance VS. Health Insurance: Understanding The Differences
When it comes to protecting our health and financial well-being, insurance plays a vital role. Two common types of coverage that often come up in discussions are critical illness insurance and health insurance. While they are related to health, these two insurance policies serve different purposes, and understanding the differences between critical illness insurance and health insurance can help you make informed decisions when selecting the right coverage for your needs.
Definition And Scope
Let’s start with its definition and how they work out.
Calgary Critical Illness Insurance is designed to provide a lump sum payment in the event you are diagnosed with a specified critical illness covered by your policy. These illnesses typically include conditions like cancer, heart disease, stroke, organ transplants, or major surgeries.
On the other hand, health insurance, on the other hand, offers coverage for a broad range of medical expenses, including preventive care, doctor visits, hospitalization, prescription medications, and various medical treatments. It aims to protect against the financial burden of healthcare costs.
Financial Coverage
For financial coverage, critical illness insurance provides a lump sum payment upon diagnosis of a covered critical illness. This lump sum can be used at your discretion, providing financial support to cover medical expenses, living expenses, debt repayment, or any other needs you may have during your illness and recovery.
Health insurance typically works on a reimbursement basis, where the insurance company pays for a percentage of covered medical expenses directly to the healthcare providers. This can include doctor visits, hospital stays, surgeries, and other eligible treatments. The coverage varies based on the specific plan and policy terms.
Focus On Illness Severity
There’s also a huge difference between these two in care.
Critical illness insurance focuses on severe, life-altering illnesses specified in the policy. It provides a financial safety net when you face a critical illness, helping you manage the associated costs and maintain your quality of life during a challenging time.
When it comes to health insurance, it only covers a broader range of medical needs, including routine check-ups, preventive care, and treatment for various illnesses or injuries. It aims to promote overall well-being, prevent illnesses, and provide necessary medical support to address day-to-day health concerns.
Payment Structure
For the payment structure, critical illness insurance typically pays out a lump sum upon the diagnosis of a covered critical illness, regardless of the actual medical expenses incurred. The payment amount is predetermined based on the policy terms and the severity of the diagnosed condition.
And health insurance only covers a portion or all of the medical expenses, subject to deductibles, copayments, and coverage limits. The insurance company reimburses the healthcare providers directly based on the terms and conditions of the policy.
Application And Eligibility
The last one is application and eligibility.
Critical illness insurance usually requires a separate application process, and the coverage is based on medical underwriting. This means that the insurance company may assess your medical history and current health condition before approving your application and determining the premium.
Health insurance is typically obtained through an employer, government program, or private insurance provider. The eligibility criteria and application process may vary depending on the specific plan or program. However, health insurance generally does not require extensive medical underwriting, and coverage is often available to a wider population.
Conclusion – Critical Illness Insurance VS. Health Insurance
Critical illness insurance and health insurance serve different purposes in protecting your health and financial well-being. Critical illness insurance provides a lump sum payment upon the diagnosis of a covered critical illness, offering financial support during a challenging time. On the other hand, health insurance provides coverage for a broad range of medical expenses and focuses on promoting overall health and well-being.
