The term health insurance refers to a unilateral contract between two parties. This contract is unilateral because only one of the parties, in this case the insurer, has to meet their obligations. The customer can at any time stop the payments, but as long as the payments are met, the onus is on the insurer to meet their obligations.
This health insurance agreement may provide a single benefit or a combination of benefits:
* All hospital expenses because of accident or sickness
* Accidental death or loss of limb
* Disability because of sickness or accident
Obviously, an accident is something that happens accidentally. An illness or sickness is obviously not the result of an accident. You must note the difference between these two as different health-insurance policies could have different provisos in their terms and conditions for sickness or accidents. Also, note that certain insurance companies may sell a separate policy just for accidents, and this does not include sickness.
You may hear the terms sickness and accident used a lot when talking about health insurance policies. Another common name for health-insurance is medical insurance.
