This is the second article in a two-part series on the essential differences between life and health insurance, and the reasons you may want to get them.
It is part of a larger collection of stories and practical finance tips published by Metrobank to help people learn from the experiences of others, and to pick up lessons on personal finance and sound money habits beyond the pandemic.
You can read Part 1 by clicking here.
For how long are you covered?
For health insurance, as long as you continue paying the regular premiums, you’re covered. Usually this is a yearly renewable policy or can be adjusted to monthly terms, depending on the policy you choose.
Life insurance covers for a specific duration or your whole life. Some policies can be paid in full up front or monthly for a fixed number of years.
Benefits to you
In addition to easing the financial burden due to medical expenses, some health insurance providers may reimburse a portion of what you’ve already paid even if you don’t get sick.
Some health plans allow you to get a cash amount if you’ve been diagnosed with a critical illness.
For life insurance, your beneficiary can get the full amount in your policy if you pass away before you completely pay the premiums. The cash sum may vary with some policies, but it usually starts at PHP 1 million.
Term life insurance also allows you to get back as much as you paid in premiums if you live beyond a certain age.
Some policies allow you to invest part of your insurance into other financial instruments, which produces additional income.
How much should you invest?
Health insurance is paid annually. Depending on your desired coverage and your age, you may start for as low as P1,000 to P3,000 a month.
More comprehensive coverage, especially for older individuals, may go over P100,000 a year.
Pure life insurance could start for as low as P3,000 a month under a 10-year payment term. Premiums could be higher depending on several factors such as income, age, and existing medical conditions.
Check out the illustration below for a quick view of the difference between life insurance and health insurance.
Insurance is the next step towards learning financial management. You can start by saving for the rainy days and getting insurance coverage. Learn more about it on metrobank.com.ph/AXA-personal-accident-insurance.
Read Part 1 here.
This article was originally published on the Metrobank website
