In times of financial distress due to a medical emergency, one can opt for two options i.e. health insurance or a medical loan. With increasing medical costs, having a health insurance policy is a boon as it offers you full coverage for the hospitalization expenses. However, the policy comes with few restrictions in the form of waiting period and pre-existing disease coverage, which may force an individual to opt for a medical loan. While health insurance is an insurance product and medical loan an unsecured personal loan, both the products have its share of benefits, which you need to know to make a better choice.
Read this blog to understand the difference between the two
What is a medical loan?
Medical loan is an unsecured type of loan, which is offered by the lender based on your credit eligibility and income details. The loan amount can be utilized for any type of medical treatment, surgery or even for paying off medical debt and even for associated medical expenses.
|Health Insurance||Medical Loan|
|Comes with a waiting period for several medical conditions and even pre-existing diseases only after which the coverage is provided||Quick application process. Fast approval and easy disbursal|
|Insured has to pay a premium amount depending on sum insured, age, lifestyle habits and other factors||Interest rates are competitive and offered based on credit eligibility and income details|
|Does not provide coverage for fertility treatments, dental treatment and cosmetic surgery unless required as a part of an accident||Loan amount can be taken for any type of treatment including surgical procedures|
|Provides coverage for specific diseases and the medical expenses as mentioned in the policy. There is a high chance of increase in out of pocket expenses||The loan amount taken can be used for any type of medical expenses including payment of doctor’s bills, hospital stay, medical debt and other associated expenses|
|Individuals having specific diseases like cancer or who would have undergone heart attack, heart surgery in the past can be denied coverage||Medical loan can be availed by everyone including cancer patients|
|Health insurance can be taken anytime as a precautionary measure towards medical expenses that are likely to arise in the future||Medical loan is taken only at the time of medical emergency i.e. when the individual is in need of urgent money|
|In case if the no claim is made, the premium is not paid back to the insured||Few lenders directly transfer the loan amount to the hospital or the clinic, the patient is receiving the treatment from|
|You cannot take health insurance at the time of medical emergency as the benefit is offered after few number of days||This type of loan can be availed as and when the individual wants to pay off medical bills for his medical expenses or for that of his family|
What is health insurance?
Health insurance is a type of general insurance product that offers coverage for medical and surgical expenses. For this type of policy purchase, the insured has to pay premium towards the coverage amount he is opting for. A health insurance policy protects the insured in case of rising inflation by providing coverage for hospital bills.