Difference Between Short Term and Long Term Health Insurance

The difference between short-term and long-term health insurance lies primarily in the policy tenure. While short-term health insurance can have a term of up to 12 months, long-term health insurance ranges from 5 to 7 years. Also, the latter is expensive when compared to short-term health insurance. Irrespective of the tenure, it is wise to subscribe to a health insurance plan as it can come in handy in times of emergency and give you from financial burden in times of health crises. Find out more differentiations between the two at Bajaj Markets. Read up for more information.

Short Term Health Insurance vs Long Term Health Insurance

Comparison Of Short Term and Long Term Health Insurance 

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Short term medical insurance refers to plans that have a validity period of 6 months to 12 months. Short term health plans cover pre and post hospitalisation, ambulance charges, organ donor expenses and more. Apart from this, you can also benefit from perks such as a No Claim Bonus (NCB) for not making any claims in the policy tenor and free-health checkups.

When compared to long term health insurance, the premium rate for short term health plans are more cost-effective due to the short policy period. Here are some key benefits of opting for short term health insurance:

Advantages of Short Term Health Insurance

  • In case you need to make changes in your policy, you can do it in just a few months as short term policies last for a smaller period.

  • In case you require a short term insurance cover while switching jobs or insurance providers, short term health plans are a suitable option.

  • It secures individuals such as international students or Non-Resident Indians (NRIs) visiting the country for a brief duration.

  • Short term medical insurance also offers tax benefits under Section 80D of the Income Tax Act, 1961.

Disadvantages of Short Term Health Insurance

  • The premiums on short term plans can be more expensive than the ones on long term plans as insurance companies offer discounts to individuals who buy long term plans.

  • Most short term plans do not provide coverage for pre-existing conditions.

  • You cannot benefit from the NCB in short term plans.

  • Short term plans usually have lesser coverage for diseases and medical expenses compared to long term plans.

What is Long Term Health Insurance?

Long term health insurance plan has a policy tenure of 2 to 3 years or more and secures the medical needs of the policyholder for more than a year. Unlike short term health plans, you don’t need to renew your insurance policy every year.

You also get additional coverage for pre-existing ailments, daycare treatment, and a comprehensive insurance plan that isn’t possible with short term plans. In the comparison between short term vs long term health insurance, the long term health insurance plans have their own set of advantages.

Benefits of Long Term Health Insurance

  • You can enjoy insurance coverage for a longer period of time in the event of a medical emergency.

  • You can stop worrying about forgetting to renew your health plan every year which can lead to a policy lapse.

  • The policy also covers alternative treatment such as AYUSH, offering policyholders another option to better their health.

  • Long term healthcare insurance gives you access to add-on benefits like critical illness cover, maternity and newborn cover, etc. along with wellness programs.

Disadvantages of Long Term Health Insurance

  1. It could be difficult to make changes to long term plans once they are set in place.

  2. People may not be willing to buy long term plans in case the insurance premiums need to be paid in a lump sum, as the cost of a long term plan will be much higher.

  3. Senior and super senior citizens may have trouble finding affordable long term plans.

Difference Between Short Term and Long Term Insurance

Let us compare short term health insurance vs long term plans based on some key parameters:


Short Term Health Insurance

Long Term Health Insurance

Policy Tenor

6 to 12 Months

2 to 3 Years

Premium Amount

Premium amount is lower when compared to long term healthcare insurance

Premium amount is slightly higher than short term medical insurance


Short term health plans need to be renewed every year

Long term health insurance doesn't require yearly renewal

Add-On Covers

Add-on covers are not available in short term health insurance

Lucrative add-on covers are available with long term health plans

Pre-Existing Illnesses

Pre-existing ailments are not covered

Pre-existing ailments are covered after a fixed waiting period


1. Overall premium paid year on year is higher when compared to long term health insurance

2. Customisation of health policy isn't possible

3. Requires frequent renewal

1. Porting your insurance policy to a new insurer isn't easy due to the longer policy tenor

2. One needs to pay a higher premium amount at once


Short term health plans are suitable for:

1. NRIs or international students

2. Individual switching jobs

3. Individual switching insurers

Long term healthcare insurance is suitable for:

1. Individuals looking for long-term protection

2. Policyholders who want to secure the healthcare expenses of their loved ones

3. Individuals who want to enjoy comprehensive coverage

Who Should Buy a Short-Term Health Insurance Policy?

Short term health insurance plans are excellent for people who need temporary health insurance or are unsure about buying a long term policy. Short term health insurance will be highly useful for the following groups of people:


  1. International students studying or traveling in foreign countries.

  2. People who wish to switch jobs and need personal insurance during the period of changing their job.

  3. NRIs visiting India for a period of time.

  4. Anyone traveling abroad for business or vacations needs short term insurance as most countries have mandatory health insurance requirements for visitors.

Who Should Buy a Long-Term Health Insurance Policy?

While short term health policies have their own advantages, long term policies are suitable for people who have a stable job and are looking for an extensive health coverage for themselves and their families. A long term health plan provides more enhanced protection to the policyholders against any unexpected illnesses or accidents. The following are the groups of people who should look into getting a long term health insurance policy:


  1. Everyone should aim to have one long term health policy to be prepared for any medical emergencies.

  2. People who do not wish to renew their policy frequently should look into getting a long term insurance plan to avoid the hassle of renewing the policy frequently.

  3. People looking to get health insurance at a lower rate should go for a long term plan as the premiums for these plans are often cheaper than short term plans.

  4. Young people should especially get long term health insurance as they can benefit from getting a lower premium for their long term plan, compared to the elderly who need to pay higher premiums. This can save a large sum of money.

Parting Thoughts

With the above comparative view of long term vs short term insurance, some of your dilemmas may have been resolved. However, to pick a suitable health insurance plan, it is recommended to understand your insurance needs first. Due to soaring healthcare costs, it is best to have the right insurance backup to avoid using up your savings during emergencies. So, don’t put it off anymore and head over to Finserv MARKETS to get a comprehensive health insurance policy and benefit from easy claim settlements, hassle-free renewals, extensive coverage, lucrative add-ons and more!

Best Health Insurance Plans Available at Bajaj MARKETS

FAQs on Short Terms Vs Long Term Insurance

  • ✔️How can I compare various short term or long term health plans available in the market?

    You can compare health plans with the help of online tools such as our health insurance premium calculator. Such easy-to-use tools enable you to select the best insurance policies by comparing the plans based on several aspects.

  • ✔️Do long term healthcare insurance plans offer tax benefits?

    Yes, long term health plans offer tax benefits under Section 80D of the Income Tax Act, 1961. Learn more about health insurance tax benefits on our platform now! 

  • ✔️Do long term health plans provide more coverage than short term health insurance?

    Yes. Many insurance providers provide more coverage and increased benefits when compared to short term health plans. However, it is advised to compare various policies and understand the terms of the plan.

  • ✔️Can I purchase a comprehensive health insurance plan online at Finserv MARKETS?

    Yes, you can head over to our platform to purchase a health plan online or download our insurance app to secure your medical needs.

  • ✔️What is the difference between short and long term plans?

    Short term health insurance plans are those that last for a period of less than 1 year. Long term plans are those that last for a period of 1 to 3 years or more.