Medical science is constantly progressing; new techniques and machines are being developed to detect and treat complex diseases. While we are benefiting from these advancements, it’s also leading to a rise in medical inflation. The diseases are discovered suddenly but they go slowly, consuming not only precious time but also hard work and money. The average person may be able to give time and hard work, but it becomes difficult for them to raise money for the disease. A large part of India’s population belongs to the middle or lower classes, for whom the medical expenses of any major disease are almost always unaffordable.

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Whenever a sudden major illness strikes, a middle or lower class person rushes towards a medical loan for money. In order to save the life of himself or any family member, they are unable to think of anything else at that time. They do not even think about how heavy the loan and interest are going to be for them later. In such cases, a mediclaim policy can keep you covered and you will not need to go around asking for money in case of an emergency.

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In this article, we are going to talk about which one between a mediclaim policy and a medical loan is the better option.

  1. What is a mediclaim policy
  2. What is a medical loan
  3. Why is a mediclaim policy better than a medical loan

A mediclaim policy is a health claim insurance that covers the expenses incurred in a medical emergency. For example, if you have taken a mediclaim policy, then in case of any medical problem in the future, the cost of hospitalization will be borne by the policy company. The medical problems covered in a mediclaim policy mainly include accidents, diseases, surgeries, tests, hospital and ambulance expenses etc.

A mediclaim policy prepares you well in advance for any medical emergency, so that you can deal with the expenses along with the diseases. myUpchar Bima Plus Health Insurance prepares you for life’s medical emergency at very low premiums. It covers hospitalization expenses as well as pre and post hospitalization expenses.

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A medical loan is a special personal loan, which provides you financial assistance in case of a medical emergency. There are many banks and finance companies that provide medical loans. The company or bank provides money to the borrower at the least interest. This loan taken during a medical emergency can be used and then has to be repaid within a stipulated period. The loan amount has to be paid along with interest while paying off the loan. The rate of interest usually depends on the credit score of the borrower.

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Now that you have an understanding of what medical loans and mediclaim policies are, let's talk about which one of them is better. Following are a few key differences between the two:

  • Immediate hospitalization: If you have taken a mediclaim policy, you can get admitted immediately to any hospital in the company’s network. On the contrary, if you want to take a medical loan, then you have to prepare many documents and then the loan company does a verification check.
  • Long-lasting diseases: There are some types of diseases in which hospitalization needs to be done many times or follow-up appointment are to be scheduled with the doctor again and again. In such situations, you cannot take a medical loan again and again. A mediclaim policy is a better idea in these situations, as no matter how many times you visit the network hospital, you’ll be able to leave the worry of expenses on your policy plan.

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  • Cash not required: This is one of the best features of a mediclaim policy - you can visit any of the network hospitals in case of a medical emergency without worrying about cash. You will not have to pay anything after hospitalization. But this is impossible with a medical loan.
  • Network hospital: Irrespective of the loan company, you do not get the facility of network hospitals with a medical loan. However, in a mediclaim policy, you can choose from the many network hospitals as per your convenience.
  • Cheap premium: The premiums paid in a mediclaim policy are much cheaper than the interest on a medical loan. If you are healthy and do not have any disease, you can also get a special discount on the premium. Whereas, you do not get any such facility with a medical loan.
  • Additional benefits: You get many additional benefits in a mediclaim policy like OPD expenses, an international second option, global coverage, etc. Medical loans do not offer any such benefits.
  • No effect on credit score: Medical loan is an unsecured loan, which affects your credit score. A low credit score reduces the chances of getting a home, car or any other loan. If you take a mediclaim policy, it does not affect your credit score.

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  • Post and pre-hospitalization coverage: No medical loan gives you separate financial support for pre and post hospitalization expenses. Whereas, by taking a mediclaim policy, you can get pre-hospitalization, post-hospitalization and even ambulance charges.
  • Tension-free life: Mediclaim policy helps you to lead a stress-free life. Nowadays, medical expenses have started skyrocketing due to the pandemic, so if you have a mediclaim policy plan, then you don’t have to constantly be worried about the expenses in case you fall sick.

So, long story short, a mediclaim policy is better than a medical loan in every respect. Once you purchase a mediclaim policy, you can start your treatment by going to the hospital whenever needed, without worrying about the cost. The documents and verification for a medical loan take some time, which becomes difficult during a medical emergency.

(Read more: Benefits of health insurance)

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