Health Insurance Vs. Term Insurance 

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Family is everything for us and all of us want to see them happy when around and also when not around.

Insurance is financial security to unpredictable circumstances of life. An emergency can occur at any place and at any time. So the security to deal with the emergency and recovery from loss is known as insurance.

There are various types of insurance like health, term, life insurance, insurance for any valuable product, vehicle insurance, travel insurance, etc. But these three-term insurance, life insurance, and health insurance are the one that provides assistance for human health or life loss. 

So from the above, the most confusing policies are term life insurance and health insurance. Term Life insurance helps your family members in case of your unfortunate death. On the other hand, Health insurance is insurance that helps you to compensate your medical bills for critical illness. There are differences in the premium, scope, purpose, and applicability of both types of insurances.

What is Health Insurance?

Health insurance is that the contract between the insured and therefore the insurance firm to supply the financial compensation just in case of specified disease happens to the insured. The quantity of monetary compensation is governed by the terms and scope of your insurance policy. The aim of insurance is to keep your financials secure against unforeseen and enormous medical expenses. Usually, the compensation is restricted to the particular expenses incurred or the sum insured, whichever is a smaller amount.

What is Term Insurance?

The insurance is the contract between the insured and therefore the insurance firm to pay the financial compensation to the nominee of the insured just in case of demise of the insured. The aim of the insurance is to supply support to the family of the insured just in case of the unfortunate death of the insured. The quantity of compensation isn’t linked to any expense, but it’s decided at the time of availing the policy.

Who needs Insurance?

It is believed that only middle-aged people buy insurance. However, this is often not true. Even youngsters and people nearing retirement can and must equip themselves with sufficient life and insurance.

Insurance and kids

Earlier, adulthood was often related to deteriorating health and severe medical issues. Moreover, chronic diseases, like cancer or heart problems, weren’t quite common. But today, the scenario is totally different. Severe diseases and disorders are common, and they aren’t just affecting older people. Even youngsters are susceptible to such fatal ailments. Also, nowadays, it’s common to seek out young individuals taking care of their family’s financial needs. Thus, they need to have a backup just in case anything unfortunate happens to them. One can’t predict the longer term. But one can always be prepared with a life and health cover. one more reason for purchasing insurance at a young age is that insurance policies are cheaper for children.

Insurance and individuals with dependent family

Individuals with family responsibilities can buy a life assurance policy to secure the long term of their loved ones. Although nothing can structure your family’s emotional loss, they’re going to have enough money to affect the financial losses that might occur in your absence. For instance, child life assurance plans provide a particular sum to your child at regular intervals once you aren’t around, even without a premium. They can, thus, fulfill their educational goals.

Insurance and elder people

Old age comes with its share of problems, health, and dependency being the main ones. But, with sufficient life assurance and insurance cover, you’ll not only look out for your health but even be financially independent and continue living proudly. For instance, there are money-back policies wherein your insurer provides certain monetary benefits to you at regular intervals.

Term Insurance vs Health Insurance Policies:

While insurance covers the expenses incurred towards treatment, life assurance can help your family reduce their financial burden just in case of your untimely demise.

Let’s inspect a couple of key differences between life assurance & an insurance policy:

Parameter

Term Insurance

Health Insurance

Category

Life insurance

General insurance

Meaning

Term insurance is a policy that is valid for a certain “term”. If the policyholder suffers death during this period, the next of kin will receive the payout of the Term Insurance policy.

A health insurance policy helps you pay the hospital bills in case of injuries or disease. It also provides various options to buy add-ons that can help in extending the scope of coverage.

Coverage

Term insurance provides a financial backup to the family members if the policyholder dies.

Health insurance provides financial help to pay the hospital bills if the policyholder or insured family members suffer from injuries, diseases, or disability.

Maturity Benefit

None

No Claim Bonus in case of no claims in the previous policy period.

Tax Benefit The claim paid out to the family is tax-free. The premium paid is considered for tax benefit.

The premium paid is considered for tax benefit.

Premium

The premium for buying term insurance is usually less than compared to Health insurance.

Health insurance policies are costly as compared to term insurance.

Policy Duration Usually 5 years or more.

One year.

Benefits of Health Insurance and Term Insurance Plans

Benefits of our Health insurance Plans

Health insurance offers protection against medical expenses

  • Critical Illness Cover – If opted for as an add-on or a neighborhood of the plan, this covers hospital expenses just in case of critical illness.
  • Daily Hospital Cash cover – This cover helps you manage the expenses beyond the hospital bill just in case of any medical emergency.
  • Pre and post-hospitalization expenses – we all know there are expenses that are usually not covered in health insurances like X-rays, scans, medicines, we confirm we look out of those expenses too.
  • Accidental Hospitalization – This benefit covers costs of Ambulance, Daycare procedures, Pre-hospitalization, and Post-hospitalization expenses that have ICU, Medication, OT, Physician Fees, Diagnostics, and more just in case of an accident.

Benefits of Term Life insurance Plans

  • This is mainly your support to your family once you are absent from their lives.
  • The premium charged is typically less.
  • With insurance comes tax breaks However, Tax savings shouldn’t be the rationale for purchasing a term policy. This policy offers tax benefits and exemptions as per prevailing tax laws.
  • High-life covers with low premiums.

To sum it up

Life insurance, and also health insurance, are essential financial must-haves. Choosing adequate protection becomes easier if you assess your health state, responsibilities, age, occupation, and other factors.

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