How is Mediclaim Different From Health Insurance Policy?

know the difference between mediclaim and health insurance policies

Usually, most of the people believe that mediclaim is same as a health insurance policy, and thus, they often use both the terms interchangeably. However, it is not the case. While mediclaim is limited to domiciliary care and hospitalisation expenditure, health insurance offers more comprehensive coverage. Let’s delve deep to know the difference between mediclaim and health insurance policy in India:

know the difference between mediclaim and health insurance policies


  • It is one form of a health insurance policy, and it mainly covers hospitalisation and treatment expenses towards a specific ailment or an accident
  • Usually, mediclaim is for a pre-specified amount. The premium of mediclaim generally depends on various factors like sum insured, age of the policyholder, gender, etc.
  • Under mediclaim, insurers settle claims either through reimbursement or cashless process. Under reimbursement procedure, the policyholder has first to pay medical bills which he/she can later reimburse from the insurer. However, in the case of cashless, nothing has to be paid by the policyholder as the medical bills are settled directly by the insurer with the hospital
  • Mediclaim insurance policy is eligible for tax benefits as per Section 80 D of the Income Tax Act

Health Insurance Policies

  • As compared to mediclaim, health insurance policies are more comprehensive
  • Health insurance plan offers wider cover, including comprehensive critical illness cover for over 20 critical ailments
  • Some health insurance companies in India offer a discount on premiums to those policyholders who opt for high sum insured, like above Rs 10 lakh
  • Some health insurance policies also come with a co-payment option, which means, the part of treatment expenses has to be borne by the policyholder while the insurer takes the rest care. This practice helps in reducing premium costs. This practice helps in reducing premium costs
  • Like mediclaim, health insurance policies are also eligible for tax benefits under Section 80D of the Income Tax Act

Mediclaim Vs. Health Insurance

Mediclaim Health Insurance Policy
It mainly covers hospitalisation expenses. It offers much wider coverage as it includes hospitalisation expenses, pre & post expenses, ambulance charges, compensation for the lost income, etc.
Mainly the sum insured is limited to Rs 5 lakh only. It is much extensive as the sum insured can go beyond Rs 50 lakh.
Hospitalisation is necessary to avail benefits under mediclaim. No need of hospitalisation to use health insurance policy.
Hospitalisation expenses are settled either on reimbursement or cashless basis. In addition to cashless and reimbursement, the insurer can also make a lump sum payout in case of an eventuality, like critical ailments.

Which one to pick: Mediclaim or Health Insurance Policy?

While choosing between mediclaim and health insurance policy, it is imperative to take into account the type of cover that you require, your current medical state, financial position, etc. Remember, health is wealth, so arm yourself with the right insurance cover to get complete protection against hefty medical inflation.

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