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difference between health and accident insurance

Difference Between Health & Accident Insurance

There is an increasing number of people now opting for a health insurance policy. But personal accident insurance remains alien to many. With the high costs of treatment for even a small accident or illness, this comes as no surprise as hospital bills are on the rise. There is a massive 8.2% increase in average medical expenses around the world. What’s more; since private hospitals are one of the only sources of quality healthcare, they’re even more expensive in India. This makes it necessary to take some precautions against accidents that could end up burning a hole into your hard-earned savings.

While most people know about the importance of health insurance and are already covered under such plans, an accident insurance policy is still not popular among Indians. Why is this? More importantly, what are these policies? Should you get one of these, both, or stick with your regular health insurance? Let’s try to understand what these are and the benefits provided by each of them!

What are health and accident insurance policies?

Health insurance is a type of insurance cover that provides you protection from sudden and unexpected medical expenses due to hospitalization. This may include medical and surgical costs occurring during treatment. Usually, health insurance policies provide pre and post-hospitalization charges. Some even offer annual health check-ups for you and your loved ones. 

Health insurance is a more comprehensive policy that provides you protection against several hospital bills. On the other hand, accident insurance proves to be slightly different in this regard. Accident insurance policies are insurance plans covering your recovery costs in case of accident. Whether it is an accident leaving you injured, disabled or dead, your accident insurance has got your loved ones covered!

Health insurance plans cover several conditions. Accident insurance is more selective and gives limited coverage. 

Why you need separate health and accident insurance policies

So, do you need accident insurance if a health insurance policy already covers you? While your gut feeling might tell you otherwise, you must understand both these policies are different and protect you in different ways. There are certain situations in which your health insurance plan might not be able to help you as much. In cases like these, it will be much more practical and helpful for you to have a separate personal accident insurance policy. It can be bought alongside your comprehensive health insurance policy.

Life is uncertain. It is impossible to estimate what it may throw at you next. There are still ways to be better protected against potential problems. This is why you should be open to getting a personal accident cover because we are all exposed to risk. Accidents are a hard reality of life, being so unexpected and financially-draining. Sadly, even risk-averse people are prone to accidents due to the negligence of a few. After all, your safety does not depend only on your conduct. It also depends on the conduct of those around you. Can you believe there were 151,000 deaths in India in 2018 alone due to road accidents?

This is why it is imperative to take precautions against any unfortunate events in life. These can be scary and can potentially have a life-changing impact on you and your loved ones.

Some differences between health and accident insurance

Here are some interesting differences between health and accident insurance.

Special features present in personal accident insurance

Since personal accident insurance is specific in its coverage, it is only made to suit all the needs arising due to unfortunate situations like unexpected road accidents. Now, because health insurance is made to cover a broader category of health events that include diseases as well as injuries, it usually gives generalized benefits. All of these benefits may not prove to be useful in case of a life-threatening accident.

Accident insurance policies, on the other hand, aid you in adjusting back to your earlier way of life after a life-altering accident which may have otherwise posed several challenges to your regular routine.

What if you lose out on your income due to your accidental injuries? Do not worry! Some personal accident covers allow you a weekly compensation amount due to loss of earnings because of death or disability after an accident. What if you are disabled and your house no longer feels comfortable the same way in a wheelchair? You still need not worry! Personal accident insurance may also allow reimbursement of the changes made in your vehicle or house due to disability and injury due to an accident. This means the insurer will pay you money to install ramps at your home, in case you are prescribed to use a wheelchair by your doctor. Even if the accident results in death, the policy makes sure your family does not suffer. These policies compensate even the costs your family members might face while organizing the funeral.

  1. Claim settlement process

One difference between health and accident insurance is the extent of investigation carried out by the insurer. This investigation will continue until they allow you to collect your claim amount. In the case of health insurance policies, the insurer does not conduct verification as comprehensive as required for accident insurance. In some cases, they even demand an FIR (First Information Report) copy registered with the police before settling the claim amount for an accident insurance policy. Sometimes, the insurer can also demand the statement of the doctor present during your treatment. Health insurance claim settlements usually do not carry out verification at such a high level.

  1. Difference in the premiums for the two policies

Health insurance policies cover a large number of conditions due to which one could face scary hospital bills. A health policy can cover your transportation charges, in-patient hospitalization costs and even some medical tests.

Due to this reason, the premium amount for a comprehensive health insurance policy is also higher. It is even higher for dedicated Cancer/Heart Insurance. There is a hidden reason why personal accident covers are not as popular as health insurance. Agents do not generally push for a plan with low premiums. This is because they get a small commission from each person who subscribes to a cheap policy. This is why they only suggest insurance plans with slightly higher premiums. You can get good coverage in case of an accident for a meagre premium amount. Personal accident insurance policies are affordable. Therefore, it would be worthwhile to buy them to protect yourself and your family from an uncertain future.

  1. Accident insurance can double up as life insurance!

Although personal accident insurance cannot replace a dedicated life insurance policy, it still helps. Health insurance policy does not offer a claim in case of your death. It is only made to meet your existing health care costs. A personal accident cover will take care of you even after your death. It gives your family the claim to the sum insured in case of your death. This is a useful feature absent in health insurance policies.

So, like two shoes complete a pair, these two policies also complement each other! Although health insurance and accident insurance have many differences, no one plan can be a perfect replacement for the other! Both these policies are important to win against unexpected challenges presented by life. Accident insurance is not popular in India, but it would still be a wise decision to get accident insurance. It will allow you to gain peace of mind and financial stability.

Difference Between Health and Accident Insurance

Which is better, health insurance or accident insurance?

Both accident insurance and health insurance are crucial to ensure a secure, stress-free future. Both serve different purposes and cater to diverse circumstances. It would not be a good idea to put one before the other. Health insurance plans cover accidents, but there are many unique benefits which only accident insurance policies provide.

Should I only buy accident insurance instead of life insurance?

It would be a wise decision to actually buy both these policies as accident insurance is not a substitute for a dedicated life insurance policy. This is because of the low death cover in the case of accident insurance plans. The claim amount for your loved ones would be much higher in the case of life insurance. Moreover, life insurance covers death due to numerous conditions, a feature that cannot be said considering the limited coverage provided by an accident insurance policy.

What is the difference between a health insurance plan and a Mediclaim policy?

Mediclaim insurance is a type of insurance policy covering hospitalization costs due to an accident or illness. Under these plans, you will not be able to claim any amount if you are not hospitalized due to your condition. In comparison, Health insurance policies are more comprehensive plans paying you more than hospitalization costs alone. They may cover even ambulance costs, pre, and post-hospitalization expenses and a lot more.

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