January 28, 2019 by Anirudh Dar
Eventualities can occur anytime, anywhere. Our rational mind always pushes us to secure ourselves and our loved ones from any unforeseen risk that might harm health, or even manifest circumstances that can end life! A solid financial preparation to mitigate such risks makes sense. With this notion, the concept of Insurance was born. Fast-forward to this day, Life Insurance & Health Insurance policies have become an integral part of the social well-being and security.
But, do you actually need both of them? Find out in the thorough anatomy of Life Insurance vs. Health Insurance below.
What is Life Insurance?
In a nutshell, Life Insurance is a contractual policy that covers the Insured person against the risk of life. A Life Insurance policy guarantees to payout an assured sum to the nominated person(s) in the unfortunate event of the passing of the insured person. The nominated people for a life insurance policy usually include the dependants of the insured person (parents, spouse, and children). Life insurance also provides the insured person with the survival benefits on the maturity of the policy in case the person survives beyond a specific age.
Benefits of Life Insurance Policy
Life insurance policies can be classified as Term Life Insurance, Whole Life Insurance and Annuity plans.
What is Health Insurance?
A Health Insurance Policy covers the hospital and specific medical expenses for insured person. It is categorized as personal insurance which compensates the insured person’s medical treatment expenses up to a specific limit. Usually, the bills related to Surgery, nursing, patient’s room, medical tests, medicines, and specialists consulting are included in the compensatory amount.
Purchase of suitable health insurance policy plans has become a norm currently, mostly due to lifestyle changes and increased probability of an illness/accident.
Benefits of Health Insurance
Difference between Life Insurance & Health Insurance
Which one should you choose?
It you who can answer this best! It is advised that you create your goal and get professional financial planning advice before proceeding.The probability of demise of a person is a rare yet certain. On the other hand, the probability of occurrence of medical conditions is more frequent. In an ideal world, a person must cover him/her and their loved ones by getting a life insurance policy as well as the health insurance policy.
Mutual Fund Investments are subject to market risk, read all scheme related documents carefully.
Mutual Fund Reserch