Navigating the world of health insurance can feel overwhelming. There are so many different plans, terms, and coverage options that it’s easy to get lost in the jargon. Two terms you may have come across are “health insurance” and “major medical coverage.” While they may sound similar, they actually serve different purposes.
So, what’s the difference between them, and do you need both? Let’s break it down.
What is Health Insurance?
Health insurance refers to a plan that covers everyday medical needs. Your traditional health insurance plan may cover doctor visits, dental care, prescriptions, and sometimes even vision. These are relatively low-cost medical services and there is a cap on how much money you can receive for each service per year.
To get health insurance, either you or your employer pays a monthly premium. Then, when you go to the doctor, you pay the cost of your treatment. Afterwards, you file a claim, and you’re reimbursed for the portion of your payment covered by your insurer.
What is Major Medical Coverage?
Major medical coverage covers critical illnesses such as cancers and heart attacks, extended hospital stays, permanent disability, and loss of limbs. While major medical coverage plans vary, the best plans offer an accident and emergency benefit. If you experience an accident, you can present a card to an accredited medical provider and receive immediate assistance. You may also receive worldwide coverage so that you can have insurance and transfer of your medical records, even if you’re travelling. There may also be a death benefit, where an assigned beneficiary will receive a payout in the event of death.
Major medical coverage also differs from health insurance in that it offers much higher payouts. You need a lot more money to treat cancer than you do to go to the dentist. So, if you are diagnosed with cancer and you have major medical insurance, you receive a sizable lump sum. This money will pay for your treatment and help you and your family maintain your standard of living while you’re unable to work.
To get major medical coverage, you choose a plan that suits your needs and your budget. Remember that your plan should be customizable. Beware of any insurance agency that doesn’t tailor your plan to you. Usually, young people and women pay lower premiums, while people who engage in risky hobbies, smoke, or drink excessively usually pay more. Even if you have a serious health condition, there are still coverage options available. These options vary depending on your unique situation and it is possible that you won’t be covered for an illness you’re already suffering from; but you may be able to receive coverage for all other illnesses.
Are You Sure my Health Insurance Doesn’t Cover Major Medical Events?
Here’s the sad part: many people don’t understand their insurance coverage until it’s too late. Being diagnosed with a critical illness is already one of the most traumatic life events you can endure. Now, imagine that on top of a life-changing diagnosis you think your health insurance provides coverage. Too late, you discover you aren’t covered. And now, you can’t afford the standard of treatment you deserve.
What Should I Do Next?
We urge you to review your insurance portfolio and familiarize yourself with exactly what’s covered and what isn’t. If you realize that you don’t have major medical coverage, compare medical plans offered by different insurance companies. When you’ve found a plan you love, talk to an agent. Your agent will address any queries and walk you through the ways you can customize your plan. Your future self will thank you for taking care of them!
