Health vs Medical Insurance– Understand The Difference

health vs medical insurance

People often use the words “health insurance” and “medical insurance” interchangeably, even though they mean different things. There is, however, a slight difference between them. 

If you think that health and medical insurance are the same, you should wait. You need to be corrected. Some people use these terms interchangeably, but there is a small difference between them. What is health vs medical insurance? People often mix up health and medical insurance, and the same goes the other way around. In this article, we’ll show you how to tell the difference between the two terms so that you’ll never get them mixed up again.

How Does Health Insurance Work?

health vs medical insurance

Health insurance pays for not only all the costs of hospitalization but also all the costs before and after hospitalization, such as the cost of an ambulance and other costs. Therefore, health insurance vs medical insurance usa. It’s a full insurance plan.

Advantages of having health insurance

Everyone knows that every health insurance plan covers a certain number of hospitals. It means that if a person is taken to one of these hospitals and his health insurance covers it, he doesn’t have to pay anything. With just the person’s policy number, the hospital can treat them without any cash.

Depending on the type of insurance policy you buy, a comprehensive health insurance policy will also cover costs before and after you go to the hospital. What is difference between medical insurance and life insurance? It can last anywhere from 30 to 60 days. It means that you don’t have to pay anything for shipping.

If you don’t use your health insurance for a year, you’ll get an increase or a decrease in the amount you’re covered for. health vs medical insurance, many health insurance companies also give their customers free medical checkups.

6 Key Differences Between Health and Medical Insurance

Here are some ways to compare health insurance plans to tell the difference between health insurance and medical insurance.


For a certain amount, medical insurance protects against having to stay in the hospital for 24 hours or longer for certain illnesses. Health vs medical insurance only pays for the costs of being in the hospital and nothing else. On the other hand, health insurance offers full protection, including hospital cost, charges for acute diseases, preventive checkups, ambulance fees, etc.


With medical insurance, you can only get benefits in the hospital. Health insurance allows you to get benefits even if you’re not in the hospital.


Medical insurance lets you make more than one claim as long as the amount you’re insured doesn’t go over. On the other hand, health vs medical insurance usually only lets you make one claim. For example, a lump sum payment for a serious illness.

Payment of premiums

In medical insurance, compensation is given in the form of money paid back to the policy owner or the network hospital for cashless claims. In health insurance, compensation for critical illnesses is given as a lump sum, depending on the terms and conditions of the policy.

Sum insured

The most you can be covered in medical insurance is 5 lakh rupees. In health insurance, however, you can be covered for over a billion rupees.

Rider benefits

Medical insurance doesn’t allow add-ons, but health insurance does for things like pregnancy, accidents, critical illnesses, etc.

Health insurance vs medical insurance: 4 top pros and cons

Tax Benefit

Under Section 80D of the Income Tax, health and medical insurance offer the same tax benefits. So in health vs medical insurance, people who buy insurance for tax and health benefits can choose either of the two policies since both offer tax benefits. But getting insurance is a good idea if you want to save money on medical costs and not just on taxes.


When it comes to coverage, there are differences between medical insurance and health insurance. Health insurance policies are better than medical insurance policies. What does health insurance cover? You can get health insurance if you want to make sure you’re covered for all kinds of medical care. But if your healthcare needs are limited and can be met by medical insurance, you could choose medical insurance plans instead.

Healthcare Needs

What was your experience with availing of health insurance? The truth is that a person’s health care costs and needs depend on many different things, like their family’s medical history, their way of life, diseases they already have, etc.


When it comes to money, a health insurance plan that covers everything is a better deal than a medical insurance plan. But the most important thing is to have some health insurance, whether it’s health insurance or medical insurance. In health vs medical insurance, you can plan to buy health insurance based on your budget. People who don’t have a lot of money to spend can look for a low-cost health insurance plan. On the other hand, people without money problems can have a full health insurance plan.

What Does Health Insurance Cover?

Medical insurance only covers some of the costs of hospitalization and treatment for pre-determined illnesses and accidents. Therefore in health vs medical insurance, Health insurance has extra coverage options that medical insurance does not. It depends on the amount guaranteed, and it can’t be more than INR 5 Lakhs.

Two claims can be made on the health insurance policy:

1- No cash

2- Reimbursement

In a cashless claim, the insured person gets care at a hospital that the insurance company pays for. The insurance company will pay for all hospital bills, and the person with insurance will not have to pay anything.

In a reimbursement claim, the insured must tell the insurance company that they are going to the hospital either before or when they are admitted. Also, all original documents, like bills, discharge cards, etc., must be kept safe. These will be needed when you ask for your money back.

Different kinds of health insurance

Simple health insurance

Most basic health insurance plans offer less coverage in exchange for lower monthly payments. What is the difference between basic health insurance and major medical insurance? Members pay a premium to be covered, and then they get enough money to pay for doctor visits, surgery, and lab tests.

Major Medical Insurance

Most major medical insurance covers more than just visits to the doctor and surgery. Health vs medical insurance. These plans may also pay for physical therapy, care in a nursing home, and rehab, as well as the cost of prescription drugs.

Insurance for Extra Medical Costs

Supplemental medical expense insurance is meant to help you pay for services and other out-of-pocket costs that your insurance company won’t cover.

Insurance for people who can’t work

Disability income insurance gives benefits regularly to disabled people who are eligible and who can’t work. With this kind of insurance, 45 to 65% of a person’s gross income is replaced without paying taxes.

Care insurance for the long term

Long-term care insurance helps pay for care costs that last for a long time. It often pays for care that Medicare or Medicaid wouldn’t cover.

Critical Illness Insurance

With critical illness insurance, if the policyholder gets sick with one of the illnesses on a list, the insurance company has to pay out a lump sum of cash.

Cash Insurance for the Hospital

Hospital cash insurance can protect a person’s finances by giving them cash benefits daily for the length of their hospital stay.


These are some of the ways that health vs medical insurance plans are different. Insurance companies offer different perks, so a person needs to think carefully before buying a policy. Both of the above policies are good for health issues, but there is a thin line between them that each person needs to understand before making a decision.

By Mehak

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