Critical Illness Articles
Should I Get Critical Illness Cover if I Have Mediclaim ?
As a relatively new insurance product, critical illness cover is only utilized by approximately 15% of the British population. Some people think it is too similar to Mediclaim, and for that reason, many simply carry Mediclaim insurance. However, the differences are numerous and the benefits completely different between Mediclaim and critical illness cover.
Mediclaim vs. Critical Illness Cover
Mediclaim insurance is a form of reimbursement insurance that pays you the cost of hospital expenses for any covered illness, disease, or injury. Typically, a person with Mediclaim can go to an approved facility for “free,” or visit any other facility and get reimbursed for the cost of the medical care while hospitalised for at least 24 hours.
Mediclaim is a good insurance to have since it takes care of hospitalisation costs due to most serious illnesses and injuries outlined in the Mediclaim policy.
Similar to Mediclaim, critical illness cover also pays should an insured be diagnosed with one or more diseases or injuries outlined in the policy. However, rather than a reimbursement insurance that covers expenses, critical illness provides a lump-sum cash benefit to the insured if they meet the qualifications. The funds from critical illness can be utilized in any fashion the insured deems appropriate.
To illustrate the difference, woman #1 has a Mediclaim policy and woman #2 has critical illness cover. Both have limits up to £200,000. However, both woman become hospitalised due to treatment of breast cancer and have medical bills of £75,000 each. Woman #1 will be eligible for only the £75,000 reimbursement, while woman #2 is eligible for the full benefit of £200,000.
Why Should I Have Both Types of Insurance ?
Mediclaim is more likely to make a payout due to your hospitalisation from a critical illness. In contrast, critical illness covers have many restrictions which may prevent a claim benefit. For instance, if you suffer a minor heart attack due to angina and are hospitalised for care, your Mediclaim insurance will pay for your hospital stay. However, critical illness cover will not likely provide a benefit because the heart attack was a minor one, and you will likely make a full recovery.
On the other side of the token, if you should become diagnosed with a serious illness such as cancer and not be hospitalised, your Mediclaim insurance will not pay anything, while critical illness cover will pay the full lump-sum benefit amount whether you were in the hospital or not.
In addition, critical illness is a good form of insurance protection for those who may have a history of certain illnesses. Heart disease and breast cancer are good examples. If other members of your family line have suffered heart disease, you are at a greater risk for heart disease as well. Critical illness cover can be a good income protection should you actually develop heart disease.
You must also understand the Mediclaim continues to be in-force even after a claim has been made. Critical illness cover terminates once a full benefit has been paid. Check with your independent financial advisor to see if you may be a good candidate for both types of insurance.
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