When you or a loved one is ill and in hospital the last thing you want to worry about is the means to pay the hospital bill. Hospital expenses reimbursement policy (called mediclaim or Health insurance policy in common parlance) enables you to pay for hospitalization expenses when you or your loved one are unfortunate enough to get admitted to a hospital.

You should take health insurance when you and your family members are healthy because you are unlikely to get the Insurance if a serious illness or disease has already set in. Answer the proposal form fully and completely without hiding any facts as it is better to get the health insurance policy at a higher premium or even not to get it at all instead of paying premium and then not getting the money when the claim arises.

Check the age up to which the policy is renewable, any sub-limits for room rents, any requirements to pay part of the eligible hospitalization expenses yourself (called co-payment), formula for increase in premium if you make a claim, formula for no claim bonus and the coverage of pre-existing disease. Or you can just fill up the form alongside and get competing offers from the leading health insurance companies. Don't forget to ask them about the parameters pointed out above.

Another policy that you may definitely need is a serious illness disability policy (also called Critical Illness Policy). When a serious illness such as a stroke or kidney failure hits you the mediclaim policy only pays for the hospitalization expenses. It obviously does not cover you for the loss of income arising from the loss of job or business due to the serious illness. This is what a critical illness policy covers. You can buy standalone critical illness policies from non-life Insurance companies or take a critical illness rider along with your life insurance policy.

What is the difference between a Health Insurance policy and a Critical Illness policy?

Though critical illness is a health plan, there are various differences between the critical illness plan and a health insurance plan. Read on to find out more.

Apnainsurance.com Research Bureau

05 Dec 2007

A health insurance plan would entitle the insured to be reimbursed in case of hospitalization for any illness, disease or injury as long as it is within the purview of the policy. The policy continues even after a claim has been made.

A critical illness plan, on the other hand, provides cover for a pre-specified/defined set of critical illnesses only; other diseases or injuries will not be covered. Here, the insurer provides the insured with a lump sum immediately or within a few days of the diagnosis of a critical illness.

Typically, the insurance plan ceases once the benefits have been paid to the insured, although a few insurers offer to cover the insured for the remaining illnesses at a lower sum assured and revised premium rates.

HEALTH INSURANCE PLAN	CRITICAL ILLNESS PLAN
Cover for diseases / illnesses / injuries; as long as within purview of policy	Cover for specific Critical Illnesses only - such as Heart Attack, Kidney Failure, Stroke
Reimbursement of actual expenses or provision of cashless benefit facility	Lump sum paid within few days of diagnosis or immediately
Policy continues even after claim is made, until renewal	Policy ceases once benefit has been paid (few offer the choice of remaining insured for other illnesses)