Difference between Health insurance and Mediclaim Policy


Is there Any Difference between Health insurance and Mediclaim Policy?


Health insurance and mediclaim are often confused for the same thing especially by a lot of new people not having much knowledge about health insurance. A Mediclaim policy offers cover for hospitalization expenses for a certain pre specified illnesses till a specific limit as per the sum assured.

The maximum cap however for all claims under a mediclaim policy is fixed at Rs. 5 Lakhs. A mediclaim policy works on the principle of indemnity where hospitalization is a definite requirement to consider any claim. Also the mediclaim policy holder needs to spend the money from his own pocket during the hospital stay and is compensated or reimbursed later.

A health insurance policy on the other hand offers a comprehensive coverage covering both pre and post hospitalization expenses. Depending on the health insurance riders, a health insurance policy can also provide adequate coverage for ambulance charges, compensation of lost income and others. The upper limit of a health insurance policy can go as high as Rs 60 Lakhs. Health insurance policies offer the chance of getting a discount on annual premium after specific period of the policy depending on the insurance company.

Another difference between mediclaim policy and health insurance policy pertains to the availability of tax deduction. While Health insurance premium paid towards a health insurance policy offers tax exemption under section 80D of Income Tax Act, the money paid towards mediclaim premium paid for self or spouse or children is eligible for tax exemption of Rs 15,000 under section 80D.


I need to undergo a dental treatment which is quite expensive. Can I claim the money from my health insurance policy?


Health insurance policies usually do not offer cover for dental and ENT treatments. Since you have not mentioned which health insurance policy you have, it is difficult to answer your specific query.

In majority of cases dental and ENT treatments are considered as cosmetic procedures and not usually covered under the protective coverage of a health care policy. Also dental treatments usually do not warrant for any hospitalization which is another reason why health insurance companies do not consider them as part of their general health cover plan. Still it is recommended that you check your health insurance policy or get in touch with the insurance service provider to see if they are offering any additional covers or riders for dental treatments.


Mediclaim and health insurance is used interchangeably. The former is a term popularized by public sector insurers like New India and Oriental, and is aimed at providing medical coverage on account of hospitalization due to injury or illness.

Private insurance companies are expanding the scope of mediclaim and looking beyond just hospitalization. Some insurers now allow for OPD expenses, annual medical checkup, wellness promotions etc. Others have built newer categories like senior citizen plans (mediclaim policies have entry age restrictions), diabetes plans (few insurers offer coverage if the proposer has a pre-existing condition) etc.

The better health insurance policy can be best arrived by having a set of 4-5 key criteria and by comparing different plans (plan details are available on websites even if interpreting the specifics might be a little confusing)

For example, my criteria set includes - 1. Sum insured of 10 lacs, 2. No co-payment or deductibles, 3. High day-care procedures covered, 4. Less than Rs. 10,000 premium and 5. Good hospital coverage around my house

Once you plot these criteria, you would have eliminated quite a few plans and would have 3-4 insurers/plans that fit your criteria set. Then check for useful value-adds that some insurers dole out e.g. restore option, free annual medical checkup, option to convert plan to a top-up plan, high NCB etc.

The best health insurance plan for you is the one which is best researched by you.


Hi Dhyan,

Even though mediclaim and Health Insurance are used interchangeably, they are quite different. Medicliam is usually indemnity-based wherein you incur the expense and then get it reimbursed. In case of Health Insurance, you have cashless claims. Note that now mediclaim policies do come with the cashless facility. Mediclaim is largely used for hospitalisation whereas Health Insurance can cover health check-ups and consultations. With mediclaim, you can make any number of claims. With Health Insurance policies such as a personal accident policy, you can claim only once. Mediclaim policies are undergoing changes and insurance firms are now offering better policies than they did a decade ago. However, Health Insurance might be more comprehensive.

BB Expert


So which one you will recommend?

I meant to say top 3 health insurance and top 3 mediclaim policies?


Hi Ashwinkumar,

Health Insurance plans give better coverage when compared to mediclaim policies. Here are some of the most popular Health Insurance plans. Please consider them only after reading the terms and conditions carefully.

HDFC ERGO Health Suraksha
This is a pretty popular health policy offering the advantage of no sub-limits. This means there will be no sub-limits on hospital room rents, hospital expenses, specific diseases and doctor fees.
Using the HDFC ERGO Health Suraksha policy, you can avail a cumulative bonus at the end of every claim-free year. This will be given as an increase in the sum assured. You are also allowed to include the cost of health check-ups when you complete 4 claim-free years. The best part is that you can avail cashless hospitalisation services across 5,000+ hospitals in India. You don’t even need to go through a health check-up for getting the policy if you are less than 45 years old. This is as long as you have no pre-existing diseases.

You can choose from a range of sum assured that starts at Rs. 3 lakhs and goes up to Rs. 10 lakhs. The policy also allows you to claim reimbursements for medical expenses for inpatient treatments under Ayurveda, Siddha and Homeopathy.

This health policy offers the advantage of automatic reinstatement of the insured if it is exhausted during a policy year. The sum assured will be restored by 200%. While other insurers offer only reinstatement of the basic sum assured, this policy from STAR HEALTH restores your entire sum assured. The policy also covers 101 day-care procedures.
You, of course, get a No Claim Bonus (NCB) of 5% for every claim-free year. This could go up to 25%.
You can claim health check-up costs of up to Rs. 5,000 if you have completed 4 claim-free years. You can avail add-on covers such as Patient Care and Hospital Cash. While Patient Care is used for covering attendant charges after discharge from the hospital, Hospital Cash provides cash benefits for every completed day of hospitalisation. The age range for this policy will be 5 months to 65 years. This means that you can take this policy for your child even if your kid is yet to turn one.

Cigna TTK ProHealth Protect
This policy from Cigna TTK restores up to 100% of your sum assured and covers even Outpatient Department (OPD) expenses. The policy will also provide you with health check-ups once every 3 years. One commendable feature of this policy is that it will cover expert opinion costs in case the policyholder is diagnosed with a critical illness. You can choose to opt for an additional sum assured of 25% as a cumulative bonus at the end of a claim-free year. This can be opted for instead of the NCB.

This policy also has a unique feature where you will be granted reward points equal to 1% of the premium that you pay each year. Each reward point will be equal to Rs. 1 and you can redeem the points for a discount in premium on your next renewal or can be used to avail services through the insurer’s network partners. The policy has voluntary co-payment where you can choose to pay the first 10% or 20% of the claim while the rest will be covered by the insurer. You can opt for a critical illness add-on cover.

Want to check out more Health Insurance plans? Click here.

BB Expert


thank you…