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HOW DOES CRITICAL ILLNESS INSURANCE DIFFER FROM GENERAL HEALTH INSURANCE?

Health and critical illness insurance are insurance policies that provide financial protection for medical expenses. While they may seem similar, there are significant differences between the two. Health insurance is designed to cover a broad range of medical costs, such as routine check-ups, hospitalization, surgery, and prescription drugs. It may also cover preventive care services, such as immunizations and cancer screenings, as well as chronic conditions, such as diabetes and asthma.

In contrast, critical illness insurance is designed to provide a lump-sum payment to the insured in the event of a specific critical illness, such as cancer, heart attack, or stroke. This payment is designed to help the insured cover the costs associated with treatment and recovery, such as lost income, medical bills, and other expenses.

This article will discuss the key differences between health insurance and critical illness insurance, including the types of coverage, exclusions, and limitations.

Types of Coverage

Health insurance is designed to cover the cost of medical treatment, including doctor visits, hospital stays, and prescription medications. Health insurance plans may vary in coverage, the cost of premiums, and the out-of-pocket expenses required.

On the other hand, critical illness insurance is designed to provide a lump sum payment to the insured if they are diagnosed with a critical illness such as cancer, heart attack, or stroke. Critical illness insurance coverage is not intended to cover the cost of ongoing medical treatment but rather to provide a financial cushion to help cover living expenses and other costs associated with the critical illness.

Exclusions

Health insurance policies may have exclusions that limit the coverage provided. For example, many health insurance policies do not cover cosmetic procedures, fertility treatments, or experimental treatments. In addition, pre-existing conditions may be excluded from coverage for a certain period.

Critical illness insurance policies may also have exclusions that limit the coverage provided. For example, some policies may not cover certain types of cancer, such as skin cancer or prostate cancer. In addition, the policy may have exclusions for pre-existing conditions or illnesses not classified as critical illnesses.

Limitations

Health insurance policies may have limitations on the amount of coverage provided. For example, there may be a limit on the number of doctor visits or hospital stays covered in a given year. In addition, there may be a limit on the total coverage provided for certain types of medical treatment, such as surgery or physical therapy.

Critical illness insurance policies may also limit the amount of coverage provided. For example, there may be a limit on the total coverage provided for a particular critical illness. In addition, the policy may have a waiting period before coverage begins, and the insured may be required to survive for a certain period after diagnosis to receive the benefit.

Cost

Health insurance premiums are typically paid regularly (monthly or annually). They are calculated based on various factors, such as the individual’s age, health status, and level of coverage provided.

The cost of critical illness insurance policies like Gibraltar BSN may also vary depending on the level of coverage provided. However, the premiums are typically lower than health insurance premiums because the coverage is more limited.

Claim Process

The process for filing and processing a claim may also differ between health and critical illness insurance. Health insurance claims are typically submitted by the healthcare provider directly to the insurance company for payment. Health Insurance Claim Process:

  • The insured receives medical treatment or services from a healthcare provider.
  • The healthcare provider submits a claim to the insurance company for payment.
  • The insurance company reviews the claim and determines if the policy covers the services.
  • The insurance company pays the healthcare provider directly for the covered services
  • if the claim is approved.
  • The insured or healthcare provider may appeal the decision if the claim is denied.

In contrast, the insured typically submits critical illness insurance claims and must provide proof of their diagnosis and other documentation to support their claim. Critical Illness Insurance Claim Process:

  • The insured is diagnosed with a covered critical illness.
  • The insured notifies the insurance company of the diagnosis and provides medical documentation.
  • The insurance company reviews the claim and determines if the policy covers the illness.
  • If the claim is approved, the insurance company pays a lump-sum benefit to the insured.
  • The insured can use the benefit to cover expenses related to the critical illness, such as medical bills, lost income, and other costs.
  • If the claim is denied, the insured may appeal the decision.

Coverage Length

Health insurance policies typically provide coverage for a specified period, such as a year or two, and must be renewed annually. The premiums may change based on the individual’s health status, age, and other factors.

On the other hand, critical illness insurance policies typically provide coverage for a longer period, often up to 10 or 20 years, and may be renewed or extended as long as the insured continues to pay the premiums. However, once the insured has received the lump-sum payment for the covered illness, the policy may no longer be necessary.

Purpose

Health insurance is designed to cover a broad range of medical expenses, while critical illness insurance is designed to provide financial support in the event of a specific critical illness.

Critical illness insurance is often used to cover costs associated with treatment, such as transportation to medical appointments or home healthcare services, that are not typically covered by health insurance.

The final take

Overall, the key difference between health insurance and critical illness insurance is the type of coverage provided. Health insurance is designed to provide ongoing coverage for various medical expenses. In contrast, critical illness insurance is designed to provide financial support in the event of a specific critical illness. It’s important for individuals to carefully consider their healthcare needs and financial situation when choosing between these two types of insurance policies. You can speak with an insurance professional to fully understand the coverage and benefits provided by each type of insurance policy.

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