The spike in medical expenses has necessitated the purchase of a health insurance policy. It enables an individual to access medical treatment via the payment of premium in installments. However, the individual must understand the concept of sum insured in health insurance to get optimum coverage. A health insurance policy is meant to assist you medically and cover you financially. Hence the sum insured in health insurance is the maximum amount that an insurer pays. It includes the overall medical expenses incurred in one financial year.

Let us take an instance to simplify the concept. Say the sum insured by a particular insurance company is 1 lakh per year. In the course of one year, it may happen that the medical expenses exceed the amount insured. It includes the hospitalizations bills, consultation fees, diagnostics, etc. If the bill amounts to 1.2 lakh then the company will compensate only the sum insured. The individual has to pay the balance of INR 20000 from his or her own pocket.

To get a higher sum insured in health insurance, one has to pay a higher premium.

Irrespective of the number claims made for various hospitalizations, the company will only pay the sum insured. The individual has to bear the expenses once the insured amount exhausts before the policy expires.


Often there is confusion between these two terms. In this comparison between the sum insured vs. sum assured, let us underline the distinction. The sum assured is the pre-defined amount that the insurer guarantees to the policyholder. In a life insurance policy, it is the amount guaranteed to the insured in case of demise. The amount of premium payable is fixed according to the sum assured by the company.

Owing to the rising demand for health insurance plans, certain companies offer both the benefits. The sum insured in health insurance is totally different from the sum assured. An integral difference is that the sum assured is entirely payable irrespective of the loss incurred. The entire pre-decided monetary benefit can be claimed by the individual when the time comes. However, the sum insured in health insurance will cover only the exact expense, neither less nor more. Let us say the insurance company offers an insured sum of 2 lakhs per year. In a year a person’s hospitalization bill may amount to 1.5 lakh. So, the company will cover that expense only. The spare amount of INR 50000 cannot be claimed by the insured member.


Death and debility are the harsh reality of life. It inflicts emotional damage to the family and often results in a fiscal burden. Only proper health insurance can spare us the financial worry in extreme medical situations. A health insurance policy can provide us medical aid and healthcare amenities without any fuss. Hence it is extremely important to choose a plan that befits one’s requirement and budget. Investing in a health insurance policy gives us the boon of mental peace and medical security. So, do not think twice when it comes to your family’s well-being.


ManipalCigna Health Insurance Company Ltd (Formerly known as CignaTTK Health Insurance Company Limited) | CIN U66000MH2012PLC227948 | IRDAI Reg. No. 151 
Reg. Office: 401/402, 4th Floor, Raheja Titanium, off. Western Express Highway, Goregaon (East), Mumbai- 400 063 | Toll free number – 1800-102-4462 | Website address –
Trade Name / Trade Logo belongs to MEMG International India Private Limited and Cigna Intellectual Property Inc. and is being used by ManipalCigna Health Insurance Company Limited under license. For more details on risk factors, terms and conditions, please read the sales brochure/ sales document available on our website (Download section) before concluding a sale.

Toll free

  • linkdin
  • facebook
  • twitter
  • youtube