Medical Insurance vs. Life Insurance

You never know when a problem or an accident will happen which is why having a good insurance policy is very important. An insurance policy is your backup if you are in a car accident, traffic accident, have a health issue or are in need of medical attention and you are unable to pay the needed amount upfront. 

Insurance policies come in different types, each with its own advantages and coverage limits but for now let’s explore two types: medical and life insurance policies.

Medical Insurance:

Provides coverage when the insured is in need of medical attention which if the insured did not have a policy to cover the medical fees would end up costing them a lot of money that they may not have on hand. They may not be able to pay or even end up borrowing money to cover the medical expenses.

Advantages of having a medical insurance policy:

Each medical insurance company in Egypt offers different policies with several packages and coverage types. There are several policy tiers available according to the client’s needs and financial abilities. All medical insurance policies have a maximum yearly consumption limit. 

The best insurance companies would be the ones to offer the highest coverage and an affordable premium. In all cases the premium will usually be less than if you didn’t have an insurance policy and ended up paying the medical fees yourself.

Medical insurance policies cover the following:

• Outpatient checkups, diagnostic scans, lab tests, and medication.
• Medical attention that requires a hospital stay.
• Surgeries.
• Pregnancy and birth (with the added stipulation that the pregnancy occurs after signing the medical insurance policy not before).
• Possibility to include dental and vision insurance as well as an addendum for critical diseases at an additional cost.

What do you know about the different insurance systems in Egypt? Find out more in our article here.

Endurance ratios in medical insurance policies:

                This is the percentage of the medical fees to be paid by the insured (policy owner). For example if the client buys medication “A” and the endurance ratio is 10% then that means they will only pay 10% of the medication’s price while the insurance company will pay the remaining 90%.

In most cases the insurance company will cover the fees for inpatient and same day surgeries if the insured goes to a hospital under contract with the insurance company. 

Some policies do not have endurance ratios included while others stipulate a certain sum that must be paid by the insured. The endurance ratio is always agreed upon by the insured and insurer before signing the insurance policy. Generally speaking, a policy without an endurance ratio is more expensive than a policy with one.

Pre-existing conditions:

A pre-existing condition is when the insured is already afflicted by a disease prior to signing the insurance policy. In these circumstances the pre-existing condition is excluded from the policy coverage but in some cases (only when a company is insuring its employees) they are covered and have a maximum yearly ceiling of coverage stipulated in the policy.

What are the medical conditions not covered under medical insurance policies?

1. Cosmetic surgery, unless the surgery is necessary to fix a deformity caused by an accident.
2. Routine medical checkups and tests such as pre-employment medical checkups or travel checkups.
3. Vitamins and stimulants.

Most medical insurance companies will offer policies that cover families including children or spouses.

Life Insurance:

This type of insurance is a bit different as the insured elects to have an insurance policy but the beneficiaries are those stipulated in the policy and not the insured themselves. The insurance policy is valid till the insured reaches a certain age such as 65 or 70 according to the policy terms. For this type of policy the insured’s death may be natural or caused by an accident.

The life insurance company will pay the coverage if the insured’s death occurs while the policy is active. The company pays the insurance amount to the beneficiaries stated in the policy. If death does not occur while the policy is active the company does not pay. The insured is always able to renew the policy if desired.

Life insurance can be divided into:

• Life risk insurance.
• Loss of life insurance.
• Loss of life or life risk insurance at the same time.

Now that you know the difference between life insurance and medical insurance check out our article on the differences between personal accident insurance and life insurance here.