What is the Difference Between Life Insurance and Medical Aid Cover?
Some people may wonder which they should buy: life insurance or medical aid cover. The short answer is both. They serve different purposes. One is used during the covered person’s life to cover medical expenses while the other takes care of the covered person’s family after death.
When a person buys life insurance, it is hoped that it doesn’t need to be used for a long time. If it is a with profit type of life insurance, it might be used while the covered person is still living but other than that, it doesn’t pay out until the person has passed on.
Medical aid cover is intended to be used during the life of the covered person to pay medical bills resulting from illness or injury. With the varying degrees of cover, deductibles and copays, the cost of medical cover varies a great deal.
What is covered is one of the differences. Life insurance covers the life up to death of the covered person while medical aid covers the health of the person during life. The two work together in a manner of speaking to ensure the family finances remain stable.
Another difference is cost. Life insurance premiums tend to be much lower than those of medical aid cover. The difference can be quite substantial. Medical aid premiums can be as much as several life insurance policies. The reason is that medical aid is expected to be used many times during the time of cover while life insurance cover pays out one time, with the exception of any savings vehicle that may be attached.
Though there are differences between what the two types of cover are and what they do, both are needed. An insurance agent can show how the two types of cover work to the benefit of the covered person and their families.