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Critical Illness Policy Vs Regular Health Insurance Policy

Updated On Sep 29, 2021

Health insurance plans are bought by most of the people these days due to the increase in the unforeseen events in the life of the people. It has become important for people to have some sort of financial backup in case of medical expenses which is provided by the health insurance policies at an affordable premium rate. There are different types of health insurance plans out of which the critical illness plans are meant to provide medical compensation for the high costs of treatments of chronic diseases. Critical illness plans are preferred over the regular health insurance plans for an overall coverage of the life-threatening diseases as the regular health insurance plan can be insufficient to meet the needs of the individuals at the time of the treatment. Also, due to the steep rise in the inflation in the health sector, the cost of basic treatments have increased which can potentially exhaust all the financial savings of the policyholders.

Critical Illness Policy Vs Regular Health Insurance Policy

About Critical Illness Health Insurance Policy

A critical illness health insurance plan offers a lump sum of the claim amount for the diagnosis and replacement of the lost income of the individual, which helps in compensating the monetary loss suffered by the policyholder. The claim amount offered under this plan is higher when compared to other standard health insurance plans. You can either add a critical illness plan as a top-up cover to your existing health insurance policy or you can buy it as a standalone policy to avail of its benefits. Following are some of the key features that are offered under a critical illness plan:

Must Read: Benefits of Critical Illness Insurance Plans

  • Around 36 life-threatening chronic disorders are covered under a critical illness plan including cancer, kidney failure, heart disease, etc. The coverage of certain diseases can differ from one insurer to the other.
  • For treatments of these illnesses lump sum of the claimed amount is provided.
  • Based on the patient’s diagnosis report, the critical illness policy approves the claim requests of the individuals.
  • This plan can be claimed after the completion of the waiting period specified by the insurer. To know more about the waiting period, you must go through the policy papers carefully.
  • A part of the sum assured under the policy can be used to compensate for the lost income due to the treatment of the critical disorder, as it can help the individual in supporting their family.

About Regular Health Insurance Plan

A regular or standard health insurance plan is a comprehensive and extensive health insurance policy which meets the basic medical dues of the policyholders at an affordable premium rate. It provides compensation for hospitalization expenses along with the medication costs, ambulance charges, room rents, healthcare expenses, domiciliary costs, and much more. The claim amount under this plan is less when compared to the critical illness plans and it cannot look after the medical treatment with high cost of treatments. Therefore, this plan is not suitable for senior citizens and people with underlying diseases. Let us look at some of the key points related to the basic health insurance plans:

  • It provides basic coverage to the policyholder cost-effectively.
  • It offers relaxation of taxes on the premium paid by the policyholder under Section 80D of the Income Tax Act.
  • It may or may not cover certain diseases, as specified by the insurer depending on the type of plan chosen and the sum assured of the plan.

Difference Between Critical Illness Plans And Regular Health Insurance Plans

The critical illness plans offer lump sum benefits while regular plans are indemnity based policies, and the critical illness plans are purchased for a longer period while the regular plans can be renewed every year. A survival period clause is included in case of a critical illness plan however, it is not the case with the basic health insurance covers. The coverage of a critical illness plan is extensive for the critical illnesses while regular health insurance plans have other medical conditions to look after.


If you are planning to secure your health along with your family, then you can go with the regular health insurance plans, but if there are senior citizens in your family or there are people with pre-existing diseases, medical history, etc. then it is advisable to get a critical illness plan for their betterment.

Also Read: Best Critical Illness Plans To Buy In 2021

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.

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