| Type of Coverage | Provides life insurance coverage for a specified term or period, offering a death benefit to beneficiaries if the insured person passes away during that term. | Provides coverage for medical expenses, healthcare services, and treatments, including hospitalization, doctor visits, medications, and preventive care, to the insured individual. |
| Purpose | Primarily designed to provide financial protection and income replacement for beneficiaries in the event of the insured's death during the policy term. | Designed to cover the cost of medical care and healthcare services, helping individuals manage healthcare expenses and access necessary treatments. |
| Beneficiaries | Pays out a death benefit to the designated beneficiaries upon the insured's death, providing financial support to loved ones. | Covers the insured individual's medical expenses, including hospital bills, doctor fees, prescription drugs, and other healthcare-related costs. |
| Premium Payments | Requires regular premium payments by the policyholder during the term of the policy. Premiums are typically lower for younger, healthier individuals. | Involves regular premium payments, which can be paid monthly or annually, to maintain continuous health coverage. Premiums are influenced by factors like age, health, and coverage options. |
| Coverage Duration | Provides coverage for a specific term, typically ranging from 10 to 30 years, after which the policy may expire, and coverage ends. | Offers continuous coverage as long as premiums are paid, with no fixed expiration date. Health insurance is often renewed annually or based on contract terms. |
| Cash Value | Generally does not accumulate cash value or have a savings component; it is primarily a pure insurance product. | Typically does not build cash value either, as its primary purpose is to provide financial protection for healthcare costs. |
| Medical Underwriting | Requires medical underwriting during the application process, which may include health exams, medical history reviews, and consideration of pre-existing conditions. | Involves medical underwriting as well, but the focus is on assessing the individual's health and medical history to determine eligibility and premium rates. |
| Coverage Scope | Solely covers the risk of death during the policy term, with no provision for healthcare expenses or medical treatments. | Covers a wide range of healthcare expenses, including hospitalization, doctor visits, surgeries, medications, preventive care, and sometimes dental and vision care. |
| Policy Renewal and Termination | Typically does not offer renewal options beyond the policy term, and coverage ends when the term expires. | Offers policy renewal options, allowing individuals to continue their health coverage year after year, often with adjustments to premiums. |
| Tax Implications | Generally, death benefits paid out to beneficiaries are not subject to federal income tax. | Premiums paid for health insurance may be tax-deductible under certain circumstances, and some employer-sponsored plans offer tax advantages. |
| Usage of Benefits | Benefits are paid out to beneficiaries only upon the insured's death, providing financial security for loved ones. | Benefits are used to cover various healthcare expenses, including doctor visits, hospital stays, prescriptions, and preventive services, benefiting the insured individual's health and well-being. |
| Common Additional Riders | Offers riders like a waiver of premium rider, accidental death rider, or critical illness rider to enhance coverage. | Provides riders such as maternity coverage, dental and vision coverage, and wellness programs, allowing individuals to customize their health coverage. |
