Choosing a plan
Health insurance vs medical aid: what is the difference in South Africa?
By MedicalAidZA editorial team · 7 min read · Updated 29 September 2026
Medical aid is a registered medical scheme regulated by the Council for Medical Schemes (CMS). Health insurance, also sold as medical insurance, primary care insurance, hospital cash cover or accident cover, is an insurance policy that pays defined benefits and is not a medical scheme.
The difference decides what happens on a big claim. A scheme must pay Prescribed Minimum Benefits (PMBs) in full. Health insurance products are exempt from the Medical Schemes Act and do not have to cover PMBs, so a serious illness can leave a large bill.
Insurance is usually cheaper and is often the only option in reach. This page shows what you get for the money, what the law says, and how to tell which product you are being sold.
The core difference
A medical scheme pools members' contributions and pays claims according to its registered rules. It must pay PMBs in full, and each benefit option must pay PMB diagnosis, treatment and care costs without co-payments or deductibles, subject to rules such as using its designated service provider. Read prescribed minimum benefits for the detail.
Health insurance pays what the policy says it pays. That may be a fixed amount per doctor's visit, a capped amount per hospital event, or a lump sum. If the real bill is bigger, you pay the difference.
Insurers say this themselves. Dis-Chem Health, Oneplan, Kaelo, Sanlam and Old Mutual each state that their health products are not a medical scheme, and most add that they are not a substitute for one.
Medical aid vs health insurance side by side
| Medical aid (medical scheme) | Health insurance | |
|---|---|---|
| Law | Medical Schemes Act, regulated by the CMS | Insurance law. Exempt from the Medical Schemes Act |
| PMBs | Must be paid in full | Not required to cover PMBs |
| Contribution or premium | Set by income and number of dependants, not by age, sex or state of health | Can depend on your risk profile and age band |
| Who may join | Open schemes must accept any applicant who applies and can pay. Restricted schemes are for a defined group | The insurer sets its own rules. Oneplan, for example, does not take dependants older than 21 on its health plans |
| Waiting periods | Limited by law to three months general and 12 months condition-specific | Set by the insurer. Oneplan lists 30 days for doctor visits and 90 days for dentistry |
| Hospital cover | Pays claims at scheme rates, with plan limits | Fixed or capped amounts, or accident only |
| Tax credit | Medical scheme fees tax credit applies | Kaelo says individuals cannot claim tax benefits on insurance premiums |
| Complaints | Scheme first, then the CMS | Insurer first, then the National Financial Ombud |
Health insurance products you will meet
These are the 2026 "from" prices published by the sellers. Ask for a quote, because premiums can depend on your risk profile.
| Product | What it is | From, per month | Key limit |
|---|---|---|---|
| Dis-Chem MyHealth Core | Day-to-day insurance, no hospital cover | R549 main member | 4 GP visits a year on the Prime Cure network |
| Dis-Chem MyHealth Plus | Day-to-day insurance, no hospital cover | R765 main member | Unlimited network GP visits, 1 specialist visit per person a year |
| Dis-Chem Accident Cover | Accident-only hospital cover | R145 main member | R380,000 per event and R1.5m per person a year. Not for illness or planned admissions |
| Oneplan Health Plan | Day-to-day only | R250 | No in-hospital benefits |
| Oneplan Core Plus | Day-to-day plus hospital | R735 | Illness in hospital up to R45 000 per insured event |
| Oneplan Executive | Day-to-day plus hospital | R2 175 | Illness in hospital up to R85 000 per insured event per person |
For comparison, these medical scheme options list 2026 main member contributions of R1 155 (Fedhealth flexiFED Savvy hospital plan), R1 275 for every beneficiary on Bonitas BonCore, and R1,278 for the lowest income band on Discovery KeyCare Start Regional. Those are schemes, so PMBs apply. Compare all hospital plans on hospital plan prices.
Gap cover is a different kind of insurance: it tops up a scheme, and cannot be bought without one. See gap cover explained.
What the law says about these products
Since the Demarcation Regulations took effect on 1 April 2017, any provider of primary healthcare products and hospital indemnity products is deemed to be conducting the business of a medical scheme. The CMS has been granting insurers a transitional exemption under section 8(h) of the Medical Schemes Act while a framework for low-cost benefit options (LCBOs) is decided. On 30 March 2025 the CMS extended its Exemption Renewal Framework to 31 March 2027. We found no announcement yet on what happens after that date.
The LCBO question is unresolved:
- The CMS's 2015 LCBO framework was not approved by the Minister.
- The Health Minister rejected the CMS's later LCBO report as unworkable in February 2025 and proposed a basic benefit package instead.
- The Gauteng High Court dismissed the BHF's application to open the market on 1 April 2025, and the Supreme Court of Appeal granted the BHF leave to appeal in October 2025.
As of 29 September 2026 we found no approved LCBO framework, so medical schemes still cannot sell low-cost, reduced-benefit options. Insurance fills that gap in the market for now.
When health insurance can make sense
Health insurance can suit someone who cannot afford a scheme and wants help with GP visits, medicine or accident costs. It is better than paying everything from your pocket.
It is a poor substitute if you face serious illness, surgery or a long stay in hospital. Dis-Chem's own medical insurance does not cover hospital admission for illness. Kaelo notes that its accident cover does not pay for planned admissions or treatment after discharge.
If your budget allows even a low-cost network hospital plan, a scheme gives PMB protection that insurance cannot. Read cheapest medical aid and low-income medical aid before you decide.
How to tell which one you are buying
- Ask directly: is this a registered medical scheme, and does it cover PMBs? Ask for the answer in writing.
- Read the small print: look for wording such as "This is not a Medical Scheme". Insurers normally state it.
- Look for an insurer and an FSP number rather than a scheme name and registration number.
- Check the CMS register. In its 2024/25 annual report the CMS regulated 71 registered schemes, 16 open and 55 restricted, with more than 9.1 million beneficiaries.
- Ask what happens on a large claim. A fixed amount per event points to insurance.
Watch names. A brand with "health" or "medical" in it can be an insurance product. The Demarcation Regulations also say an insurer may only use "medical" for gap-type products if it is followed by "expense shortfall".
Where to complain
For a medical scheme, complain to the scheme and then to the CMS. See how to complain to the CMS. For an insurance product, complain to the insurer and then to the National Financial Ombud. The CMS says it can also receive complaints about insurers operating under its exemption, but the ombud is the standard route for insurance.
Knowing which product you hold tells you where to go if a claim is refused.
Frequently asked questions
What is the difference between medical aid and health insurance?
Medical aid is a registered medical scheme regulated by the CMS that must pay PMBs in full. Health insurance is an insurance policy that pays defined amounts and is exempt from the Medical Schemes Act, so it does not have to cover PMBs.
Is health insurance cheaper than medical aid?
Usually, yes. Oneplan's day-to-day plan starts at R250 a month and Dis-Chem MyHealth Core at R549. The lower price buys narrower cover, and some products have no hospital cover for illness at all.
Does health insurance cover PMBs?
Not as a legal duty. Kaelo's own FAQ says health insurance is exempt from the Medical Schemes Act and does not have to cover Prescribed Minimum Benefits. Only a registered scheme must.
Can health insurance replace medical aid?
Not safely for serious illness or surgery. The insurers themselves say their products are not a substitute for a medical scheme. It can help with day-to-day or accident costs when a scheme is out of reach.
How do I know if I am buying medical aid or insurance?
Ask whether it is a registered medical scheme and whether it covers PMBs, and get the answer in writing. Insurance documents name an insurer and an FSP number and state that the product is not a medical scheme.
Is gap cover medical insurance?
Gap cover is insurance, not a medical scheme. It pays the shortfall between what a specialist charges and what your scheme pays, and it needs an active medical scheme. Its annual limit is R226 881.03 per person from 1 April 2026.
Can I claim a tax credit on health insurance?
No. The medical scheme fees tax credit applies to medical scheme contributions. Kaelo says individuals cannot claim tax benefits on insurance premiums. See the tax credit guide for the 2026/27 amounts.
Who do I complain to about health insurance?
Complain to the insurer first, then to the National Financial Ombud. Complaints about a medical scheme go to the scheme and then the CMS.
