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Life or Health: Which Insurance Cover Must You Choose
[Posted by: InsuringIndia Blog on 04-Feb-2016]

In today's high pressure world, technology has not only made life easy but it has also increased the possibility of prolonging human life. However, nobody can predict when human life may end or what is in store on the health front. In this scenario, you have to safeguard yourself against unforeseen events via an insurance policy, that  will not only take care of you but your family too in case you are not around. Then should you opt for a life insurance policy or must you choose a health insurance over it, which will cover any illness and medical expenses? Most people tend to overlook health insurance and prefer opting for life insurance. In fact, you should get a life insurance cover along with a separate cover for health. Here is a look at existing options in the market and why you must opt for both policies instead of just one:

 

What is a life insurance policy? 

 

This policy is essentially a contractual agreement between an insurance policy holder and the insurance company where the holder pays a fixed amount to the insurer. This is done on the agreement that the insurer will pay a designated beneficiary a sum of money in return for a premium, upon the death of the insured person (often the policy holder). On the holder's death his beneficiaries or kind get the money. 

 

There are different types of life insurance policies available in the market today. The first type is a Term Insurance policy which is cheaper and more beneficial for the nominees and gives a lump sum in case of the policy holder's death. The main advantage it gives to the policy holder is that it saves on tax. 

 

Whole life policy covers the policy holder for life. Unit-linked Investment Policies (ULIP) have the dual benefit of being an investment instrument and an insurance cover, while a Money Back Insurance policy as the name indicates gives the policy holder money back after a fixed time. A pension policy is a retirement planning policy which asks you to affix an age for retirement and earns benefits.

 

Important facts to know about Life Insurance 

 

·         The main aim of this policy is to ensure financial security of your loved ones after your death. It is not an investment. 

·         A life insurance policy gives you an edge when it comes to saving on tax.

·         A life insurance policy guarantees you peace of mind that your kin will be taken care of, after your death. 

 

What is Health Insurance 

 

Health insurance primarily gives you protection against escalated medical & surgical expenses and is a way of ensuring that you can afford proper medical care without any stress. Like any other policy, here too a policy holder pays a certain premium to the insurance company. It varies from one company to another. 

 

Why you should opt for health insurance 

 

Illness or grievous injury does not come with prior warning. If you are not insured to deal with these tough times, then not only will these eat into your emotional well being and savings, but it will also impact your financial future. 

 

The market is replete with choices-- individual health insurance, family insurance, health insurance for senior citizens and critical illness among others. While choosing a health insurance cover, always consider how much are you willing to pay and what suits your needs the best. Always choose a comprehensive policy which has the maximum advantages. 

 

 

Advantages of Health Insurance 

 

·         Lump-sum is given in event of a Critical illness

·         Convalescence allowances

·         Ambulance & attendant services

·         Tax benefits

·         Hospital costs like room rent, prescription drugs, lab tests, services and devices that aid your recovery

·         Other hospitalization costs

·         Maternity and newborn care

·         Treatment taken at home

 

Why take both Life & Health Insurance 

 

As mentioned, life insurance is basically ensuring your tomorrow is protected in the form of financial security for yourself and your kin, depending on the kind of insurance policy that you opt for. Whereas, health insurance essentially safeguards your medical and treatment costs thereby securing your finances. Both are essential, one to secure your today and the other to provide financial security for you and your family's brighter tomorrow. 

While buying these polices always read the fine print and compare existing policies --premium, benefits, disadvantages, sops, terms and conditions--to see what suits your needs the best. It's always best to buy an insurance policy online as it saves time, is cost effective and is a transparent option. Go ahead and secure yourself. 

Get Comparison and Quotes of the Best Term Plan



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*This is based on the difference between the highest and lowest premium's for a single person, age 25, looking for an individual health policy with the sum insured of Rs. 5 lakhs.
**This is based on the difference between the highest and lowest premium's for a single person, age 25, looking for a term plan, with the sum insured of Rs. 30 lakhs, and the premium paying term of 30 years.
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