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Blog > Health Insurance > What is the difference between term insurance, life insurance and health insurance?

Term Insurance vs Life Insurance vs Health Insurance

Insurance is financial aid to an unpredictable circumstance of life. The idea of insurance was to be able to provide protection to the ones who bear the loss due to an uncertain environment. The unforeseen situations can occur at any place to anyone at any point in time. With this understanding, an idea of recovery from the loss was invented which is now commonly known as Insurance.

There are various types of insurance like health, term, life insurance, insurance for any valuable product, vehicle insurance, travel insurance etc. But these three – term insurance, life insurance and health insurance are the one that provides assistance for human health or life loss. 

It is important to understand the basics of insurance policies before enrolling for them. After all, an informed choice reaps a better result. Products Insurance can help you to recover the loss of non-living entities by financial aid. But the uniqueness lies where they support the loss of living being like the demise of any family member or during the critical times. It is also a fact that there can be no recovery from loss of our loved ones but financial aid becomes important to keep the family intact. So let us understand the essence of each one.

Introduction to the three main policies:



  • Term Insurance policy: It is for a fixed term, like 20/40 years. Insurance companies provide financial assistance to the nominee of the policy holders, if the person dies within the term of the policy. It is also known as a pure protection plan, which means to provide protection for your family when the care taker has passed away. There can be no claim to the money, if the person survives till the maturity of policy tenure.

     
  • Life Insurance policy: Under this, policy holder receives benefit on the maturity of the policy. If the person is alive or dies, the payment is guaranteed as per the promise. The policy holder can set tenure for the policy and if they are not alive by then the money is given to the nominee.

     
  • Health Insurance policy: It is to assist policy holders with their medical expenses. All the medical claims of policy holders or for their family members are covered in a Health Insurance policy. It helps a person in the need of their health emergencies which could be anything like cancer, tumour, surgery or even Covid-19 etc.
     

Term Insurance vs Life Insurance vs Health Insurance




Difference among these three insurance policies


 
Benefit type Term Insurance  Life Insurance  Health Insurance 
 
Coverage 
Term Insurance provides coverage for the premature death of the policyholder within the fixed term.  Life Insurance provides coverage on the maturity of the policy.


 
Health Insurance provides coverage on the medical claims within the tenure. 
Duration Range starts from 10 to 30/45 years.  Range starts from 5 to 30 years Range starts from 5 to 10 years 

Premium
Low and affordable premium.
Term insurance is the cheapest among all the insurances. 
Premium is comparative higher than term insurance coverage.  Premium increases with the age of the policy holder. 


Death benefits 
Payable

It is only payable if the policy holder dies till the maturity of policy. 
Payable

Provide benefits for both the conditions, if the policy holder is alive or with his demise on the maturity of the policy. 
Not payable 
 
No benefits if the policy holder dies immediately with the illness and without hospitalisation. 

Common benefits of these insurance policies


 
Payment process Payment can be one time premium, partial or regular one. 
It is pre-decided by the policy holder as per the plan enrolled with the insurance company. 
Purchase of the policy  All the policies can be purchased online through the website. 
Younger the policyholder is lesser premium is charged. 
Transferable  All the policies can be transferable from one provider to another without having to pay extra charges. 
Tax exemption  All the three policies are exempted under the Income Tax Act up to a certain amount. 
 
All the three policies serve different needs for the consumers. They have their benefits and differences. The choice is completely dependent on one’s needs along with family dynamics.

We all know death and illness comes to our door without knocking. Being prepared is the only way to deal with it.                                    
 

Why health insurance is a must and top priority?


 
Health needs are important and it should always be our priority over any other needs of lives. Spending money on health should be looked at as an investment rather than as an expense. With the current lifestyle, our physical labour has decreased and consumption of processed food has increased. Our generation is more prone to illness and lifetime diseases. With the good health policy you will be ready for any health challenge in the future. 
 
Health Insurance policy provides good coverage for policyholders with their customised plans as per individual needs. It gives you a wide variety of plans like individual coverage, floater family, couple, elderly parents and critical illness insurance. One can choose as per their requirement. These plans take care of the person holistically from the pre, post hospitalisation covers, ambulance bill, any lifestyle changes that might come with the illness etc. With the increase in medical inflation globally, it has become even more vital to invest in good health care plans.


Words of wisdom:
 
For all those who are young like 25 to 30, it is crucial to start thinking about small health investment. Because the cost of normal surgery today takes 3-5 lakh, in the coming 5-10 years the same surgery would cost you double or even more. With the medical advances the cost hasn’t decreased, neither will it in near future. So thinking that you are young and healthy and there is no need for health insurance is not a correct approach. You should push your family and friends as well for such wise investment. 

HDFC ERGO Health is one of the best players in the market with a bundle of amazing plans. It provides you customised offers as per your need with anytime assistance. The process to enrol for our policy is simple and customer friendly. All this can be done by sitting at home through your laptops and mobile phones only. So don’t wait, read more about our plans on the website and mobile app. 
 
Secure your health, secure your life!!!

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