The Importance of Having Critical Insurance

Critical illness insurance covers medical emergencies such a heart attack, stroke, or cancer and pay out cash to help cover overruns where ordinary health insurance may fall short.

What is Critical Illness Insurance?

Critical illness insurance is a type of insurance that covers you should you fall seriously ill or injured unexpectedly. It offers protection for various medical emergencies, such as stroke, heart attack, and cancer. Since these conditions frequently result in a high medical cost, traditional health insurance may not cover them. With critical illness insurance, you will receive a payout to help cover out-of-pocket expenses resulting from the treatment of a severe illness. It will help in reducing the financial burden of ongoing treatments and other recovery-related costs of the patient.

Most people believe that life insurance will cover their family’s needs if they die suddenly, but suffering from a critical illness or long-term disability can be just as financially devastating. If you have dependents who rely on your income, you might want to consider getting critical illness insurance.

Key points

  • Critical illness insurance protects you against the financial burden of serious illnesses.
  • With critical illness insurance, you will receive a payout to help cover out-of-pocket expenses resulting from the treatment of a severe illness.
  • One of the major benefits of critical illness insurance is that you can fully recover without having to worry about the consequences of being unable to work.

What Conditions Does Critical Illness Insurance Cover?

The medical conditions that critical illness insurance cover varies from one policy to another and between insurance companies. Some insurance companies include 30 ailments. Others may include more than 60 ailments.

Below are some of the major ailments covered under most policies:

  • Heart attack
  • Stroke
  • Cancer
  • Paralysis
  • Major organ transplantation
  • Primary pulmonary arterial hypertension
  • Aorta graft surgery
  • Alzheimer’s disease
  • Benign brain tumor
  • End stage liver disease
  • Multiple sclerosis.

It is important to remember that even if your illness is on the list, the severity or permanency of the condition determines whether or not you get a payout. For example, some insurers won’t cover certain forms of cancer since they are easily treatable, thus not seen as a significant threat. Some insurers won’t pay a claim for cancer until it has reached a specific stage as well.

What Are the Benefits of Critical Illness Insurance?

Many people believe that critical illness insurance is unnecessary because their traditional health insurance plans cover all medical expenses, there’s much more to critical illness insurance that will greatly benefit you in the future. Below are some of the main benefits of critical illness insurance:

Serves as a source of income
Critical illnesses will not only affect the individual physically but also have a significant financial effect on the family as well. A critical illness policy pays a lump sum payment that can be used to cover medical and household costs expenses.

Provides peace of mind
Critical illness insurance provides peace of mind because one can now focus on medical care rather than worrying about funds for medical and household expenses.

Provides tax advantages
The payout for critical illness is tax-free.

Includes care received in a foreign country
A fixed amount is charged on the diagnosis of a critical ailment under a critical illness insurance plan, regardless of whether the care takes place abroad. It means that if you need to go overseas for medical treatment, the policy will assist you.

“Each health insurance policy has different coverage, which may or may not cover treatments for serious illnesses. Critical illness insurance will provide you with a lump sum payment to cover your expenses.”

Why Is Critical Illness Insurance Important?

You may buy critical illness insurance on your own or through your company. You may even save money by combining it with your existing life insurance plan. Companies have been eager to add these programs because they know that workers are concerned with high out-of-pocket costs associated with a high-deductible plan.

One of the most important aspects of critical illness insurance is that the funds can be used for a number of purposes, including:

    • To cover the cost of essential medical care that would sometimes not be available.
    • To cover treatments that aren’t covered by a regular insurance policy.
    • To cover everyday living costs, allowing chronically ill patients to devote their time and energy to getting better rather than struggling to pay their bills.
    • Transportation costs such as travelling to care facilities, redesigning cars to transport motorbikes or wheelchairs and installing lifts in homes for chronically ill patients who are unable to climb staircases.
    • The funds may be used to take a holiday with friends or family for terminally ill patients or others who simply need a relaxing place to recover.

If you can’t afford the costs of daily life and medical bills without assistance, critical illness insurance is a must.

Do I Need Critical Illness Insurance?

As mentioned before, most traditional health insurance won’t cover the treatment costs of severe illnesses. Besides, it will not replace your income if you got sick unexpectedly and you cannot work because of long-term illness or disability.

You should definitely consider getting critical illness insurance if:

  • You don’t have enough savings to pay for living expenses and medical costs if you become seriously ill or disabled.
  • Your employer doesn’t provide an employee benefit to cover a long time off work due to illness.

How Much Sum Insured Should I Take?

Not having sufficient funds is one of the most frightening things when battling critical illnesses. There is actually no standard rule to decide how much sum insured you should take. However, you should decide it as per your income, age, and lifestyle.

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Critical Illness Insurance Guides