types of health insurance

What Does Health Insurance Cover?

You have probably heard people and government leaders talk about health insurance and tried to understand what it is all about. Technically, health insurance can be confusing if you do not get accurate information. However, health insurance should not be a complicated subject, provided you get the data from authentic sources.

Insurance cover entails several categories. Ensure you buy health insurance that covers your issue precisely to be on the safe side. Health insurance should not be confused with life insurance. Typically, life insurance is meant to cater for your loved ones once you die, while health insurance covers your medical costs.

 The following are the typical primary health insurance types:

1. Critical Illness Insurance

 The critical insurance plan arranges a payout if you are discovered with a critical illness, for instance, cancer. Most acute diseases like stroke, heart attack, or cancer are classified as being in the early, intermediate, and advanced stages.

When you are diagnosed at an early stage, the early critical illness plan pays out your medical bills. However, the premium for early critical illness coverage will presumably cost more than insurance plans covering only critical illness in the advanced stage.

what does health insurance cover

Apart from that, most critical illness insurance plans cover when your illness reaches an advanced stage.

  • Multi-pay Critical Illness Coverage

 This is another type of critical illness insurance. Instead of paying a single lump sum, this plan pays out multiple lump sums at each stage of the illness, e.g., early, intermediate or advanced stage. This ensures that you are covered if the condition worsens throughout the three phases.

It would help if you kept in mind that standard critical illness insurance will only contribute one payout should you be diagnosed with a critical disease. On the other hand, a multi-pay critical illness plan will cover you for acute infections even after the first payout and diagnosis.

  • Gender-specific Critical Illness Coverage

It is also possible to get coverage for critical illness based on your sex. These types of coverage are precisely targeted to diseases that are most likely to affect males or females. The policies don’t cover only one stage of the illness but protect from diagnosis to recovery. This means that you will receive surgical benefits outpatient psychiatric, which most policies don’t cover.

You can avail of health insurance policy if you hail from a family with a medical history of gender-specific illness. It would help if you bought a health insurance policy that would cover your medical needs.

2. Medical Expenses Insurance

 Medical expenses insurance covers your treatment and hospitalisation costs.

3. Disability Income Insurance

This insurance policy covers a percentage of your income if you have a Total Permanent disability that makes you unable to work.

For example, a disability income plan may contribute an income replacement of 70 percent. If you make $ 6,000 a month and you are disabled in a way that you can’t work, the policy plan would pay out $ 4,200 per month after the coverage period.

They will continue to payout until you return to work or reach the age of 60 or 65, depending on the policy terms.

The other two types of disability income insurance are:

a) Severe Disability Income

 This is when you are unable to do at least three activities of daily living:

  • Dressing yourself
  • Washing yourself
  • Using the toilet
  • Moving or otherwise walking (moving from room to room)
  • Transferring yourself (move from bed to a wheelchair)

Unlike disability income insurance, this policy plan gives a fixed payout. The payout amount continues for the rest of your life and is determined by the policy but not what you used to earn.

b) Total Permanent Disability (TPD) Insurance

It is classified as a form of life insurance. When you meet the benchmark of being permanently disabled, TPD insurance gives a single lump-sum payout. TPD means you are disabled to the extent that you cannot ever work again, the loss of two limbs, or blindness.

It is important to note that you must be employed to acquire disability income insurance.

4. Group Healthcare Insurance

This is the health insurance plan provided by the employer. The policy lasts as long as the company employs you as a job benefit.

In group healthcare insurance, the employer has sole control over the policy he picks. You will lose group insurance coverage when you get unemployed or when you retire.

5. Maternity Insurance

Also known as prenatal insurance, maternity insurance is for expecting parents. The plan provides coverage for complications during pregnancy or diseases affecting the newborn.

Examples of complications in pregnancy are stillbirths and eclampsia, while newborn diseases include the absence of two or more limbs and congenital blindness.

types of health insurance

6. Specialised Insurance for Pre-existing Conditions

 You should buy a health insurance plan of this kind if you have specific existing conditions. Pre-existing conditions cannot be covered under normal circumstances by health insurance. That is why you should check insurance comparison sites such as MoneySmart to view companies offering specialised plans.

Take Away

There are a variety of policy plans to cover your health conditions. Find the best health insurance plan today that will suit you and consider the benefits you will receive.

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