Health Insurance vs Life Insurance

Health Insurance vs Life Insurance: Which One is Beneficial in 2024

Most of the people feel confused to select proper insurance. Sometimes, they may have little ideas about health insurance and life insurance. In this post, we will try to make a comparison between Health Insurance vs Life Insurance.

There is hardly anyone who does not want to secure their future. And for that, you need to purchase either life insurance or health insurance or, in some cases, both. Read the following discussion to understand what life and health insurances are and how they can benefit you and our family.

What are Health and Life insurances?

Health Insurance

Insurance companies offer health insurance to provide coverage for your medical expenses. Policyholders pay a certain premium amount for their health cover. When you are enrolled in health insurance, the insurance company directly pays the medical costs to the hospitals. If you have paid from your pocket, you can apply for reimbursement with your insurance provider. Some health insurance plans also cover the expenses of your prescribed medicines.

Health insurance is mainly of three types:

1. Individual Health Insurance

Individual health insurance is specifically designed for a single person. This plan provides coverage and protection from various medical conditions, accidents, hospital costs, and other medical emergencies. Besides, individual health insurance also offers maternity benefits, OPD expenses, critical illness cover, etc.

2. Family Floater Health Insurance

As the name suggests, a family floater health insurance is tailored for the family members. The plan safeguards all the family members from any accident, illness, hospitalization, and other medical emergencies.

3. Senior Citizens Health Insurance

A senior citizen’s health insurance is for people who are above 60 years ago. This plan is designed for the physical and psychological needs of senior citizens. It offers such benefits as costs for organ donation, domiciliary care, critical illness care, and much more.

Life Insurance

Everyone works hard to secure a better future for their family. They do not want their loved ones to struggle financially when they aren’t there anymore to look after them. Life insurance assures you a safeguard for your loved ones in such a case. It guarantees a death benefit in case of any unfortunate event leading to the insurer’s death. The policyholder pays a fixed premium at certain intervals to ensure that the insurance company provides financial support to his family after his demise.

Life insurance can be of two types:

1. Whole Life Insurance

This plan has fixed premium pay-outs and a sum assured to the nominee. Whole life insurance is less expensive than Universal life insurance because of its consistency and no-risk approach. You can also apply for a loan against this type of plan.

2. Universal Life Insurance

Universal life insurance is also called an investment policy. This is because a specific part of the paid premium can be invested to increase the cash value of the sum assured. This means after the death of the policyholder; the nominee will get a death benefit of a big amount. However, this insurance is expensive compared to whole life insurance.

Health Insurance vs. Life Insurance:

In the following table, we will show you a brief comparison between health insurance and life insurance:

Life Insurance

Health Insurance

Life insurance provides you with complete coverage throughout your life. In case of an unfortunate event that leads to your death, your beneficiary will get the sum assured. Hence, you do not have to worry about your family.Health insurance is limited to covering your medical expenses in time for medical emergencies. You can choose either an individual or a family package.
The premiums can be both fixed and flexible, depending on your select plan. It also has a future investment value policy for extra cash value.The premiums are mostly fixed, and one can claim a No-claim bonus in some instances. Health insurance does not offer any investment policy as it only covers medical emergency costs.
It is a long-term plan.It is a short-term plan.
Life insurance provides financial assistance mainly to the beneficiary or nominee of the demised policyholder.Health insurance provides coverage for self and family members to avoid uncertain medical costs.

Benefits of Life Insurance plans

The following are some of the benefits of a life insurance plan –

  • Financial guarantee and safeguard
  • Tax-free pay-outs
  • Assured death benefit
  • Tax benefits as per tax laws

Benefits of Health Insurance plans

Some of the benefits of a health insurance plan are –

  • Restoration of the sum insured
  • Critical illness cover
  • Daily hospital cash cover
  • Maternity benefit
  • Domiciliary hospitalization
  • Expenses for pre and post hospitalization
  • Accidental hospitalization

Both health and life insurance secure a better future for your family and those you love. Health insurance will cover your uncertain medical expenses, while life insurance will provide financial support to your family in your absence. Now it is your decision which insurance you will opt for. Sometimes it is better to have both life and health insurance simultaneously.

Frequently Asked Questions

  • Is it worth it to buy life insurance?

You can pick a life insurance plan if you have a loved one dependent on you. It can be your spouse, children, siblings, or parents. Buying a life insurance plan is worth it because, after your demise, your beneficiary will get the insured sum as a death benefit. Also, we will recommend you to check this article “Health Insurance vs. Life Insurance” for a clear understanding.

  • What medical expenses do health insurance plans not cover?

Health insurance plans do not cover the following medical expenses:

  • Pre-existing diseases
  • Cosmetic surgery
  • Abortion
  • Diagnostic charges
  • Pregnancy
  • Alternative therapy charges
  • Supplements
  • Extra charges

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