There is a significant difference between life insurance and health insurance that may not be clear at first glance.  When choosing a health or life insurance policy it is very important to know the difference and read the policy documents to ensure you know exactly what you are getting.

Health Insurance

Health insurance is designed to help with the cost of medical treatment and provides access quickly to good quality treatment in the event that the policyholder becomes ill.  It may offer full cover or partial cover for certain conditions, depending on the price paid and the medical history of the policyholder.  Health insurance can provide cover for many conditions that are expensive to treat, or can provide speedy access to expertise or excellent facilities should a policyholder require treatment.

Life Insurance

Life insurance is designed to ensure that if a policyholder dies unexpectedly, their loved ones and beneficiaries are financially secure and are not placed in undue financial hardship.

There are two main types of life insurance: term life insurance and whole life insurance.  Term life insurance is a simpler and less expensive policy that provides insurance for a set period of time with no financial return at the end.  Whole life insurance is a life insurance policy and an investment scheme whereby part of the premium is invested into some type of asset portfolio such as a mutual fund or shares.  These are usually more expensive and often it is more economical to have a separate life insurance policy and unrelated managed investment portfolio.