If you've been lucky enough, you've probably never experienced serious illness. Maybe you've never even heard of it. However, have you thought about what would happen if you become critically ill and unable to earn a living? Would you be able to cope with all the daily costs, your house mortgage, and utilities or will the financial burden be too much to bear? If the answers to these questions are no, or you don't know the answers at all, then critical illness insurance is something you should consider adding in your life.
Critical illness insurance is not something that we think about regularly, but it's definitely something that we need to be aware of. The effects of a critical illness can be devastating both emotionally and financially, so being prepared for these difficult times is not only beneficial but also recommended by many experts from the legal, financial and psychological fields.
A critical illness (or serious illness), is a medical condition that deems you unable to work. Critical illness insurance is a type of insurance that will provide coverage as a lump sum payment after the policyholder gets diagnosed with one or more of the critical illnesses or conditions covered in the policy.
Some examples of critical illnesses are:
As life keeps getting faster and more stressful, the need for critical illness insurance increases. When looking at some of the statistics, the reason for this increasing need becomes apparent:
When you take into account all the risks we’re constantly under, both financially, physically and mentally, it’s understandable why crucial illness insurance is an option to consider. If you ever become unable to work due to severe illness, your whole financial wellbeing is compromised, something nobody wants to experience. This is where critical illness can step in and help. Exactly how it can do that will be explained in the next paragraphs.
You may already have health insurance and are wondering why would you need an additional type of insurance. While medical insurance covers the costs related to your medical care, it doesn’t cover what comes after you leave the hospital. This is where crucial illness insurance steps into play. Or at least it can step in.
The way this type of insurance works is that, if you have an active critical illness insurance policy and something happens to you after the effective date of the policy, you will start receiving regular monthly benefits as outlined in your specific policy.
In general, critical illness insurance will provide coverage when you experience one or more of the following:
Every policy is different and specific conditions covered will be listed in the policy. These illnesses all require extensive medical care which usually results in high medical bills. Most often the medical bills are too much for one family to bear, so they become just another problem to worry about in the midst of everything. Critical illness insurance provides a solution to this. Beneficiaries receive a lump sum enough to cover all, or at least the majority of medical costs.
However, every illness has preset conditions that need to be met in order to receive the critical insurance benefits, so it’s best to ask your agent about the underlying terms and conditions for each one. In most cases though, the more illnesses your policy covers, the higher the premium will be.
If you’re considering critical illness insurance, but you’re unsure of whether you would need it, you can easily find out by just adding up your daily expenses. Add up what you spend on food, rent, bills, mortgage, school fees, gas and anything else you spend money on. How much do you need on a monthly basis? Will you be able to afford additional medical bills on top of those expenses? If the answer is no, then critical illness insurance is definitely for you.
Even if you do have some savings on the side, calculate how many months those savings would last. Most often the savings can cover only part of the medical bills, which again indicates the need for critical illness insurance.
Unlike health insurance that covers health costs only, critical illness insurance can be used to cover all sorts of costs. For instance, you can use your critical illness insurance for any of the following costs:
Since you receive the money as a lump sum, the way you decide to spend this money is completely up to you. The amount you will receive can range from a few thousand dollars to sometimes even hundreds of thousands, it all depends on your policy.
Some factors that impact the price of your policy can be your age, occupation, sex, current health, and your family’s medical history.
We offer some of the best rates on the market when it comes to critical illness insurance. In addition, we employ only experienced insurance agents who can help you and provide guidance through the whole process from filling out the application form to receiving the benefit.
Here is how you can apply:
Step 1: Fill in an application form
The application form contains some basic questions about your age, occupation, medical history and a few questions about your lifestyle and habits.
The Critical Illness Insurance Company will do a medical check to confirm your medical state and approve your application.
Step 2: Pay your monthly premiums
Once your application is approved, the carrier will issue a critical illness insurance policy in your name. Once we do that, all that’s left is to keep up with your regular monthly premium payments.
Step 3: File a claim
If you experience any critical illness covered by your policy, file a claim for your benefits. Once the carrier has gone through your claim and everything required, they will approve it and release the payment.
Step 4: Receive your benefits
This step is the easiest of the list. Once you receive your benefits, you can decide to spend them according to your needs and desires. It can be for medical costs, living expenses, or even a trip with your family to your favorite place.
The cost of your critical illness insurance payment, or also known as premium depends on a few factors, such as:
If you are at a higher risk to experience critical insurance, your premium will also increase. The math is simple – the higher your risk, the higher the premium. Additionally, if you’re under the risk of a particular condition that is not covered by the basic critical illness insurance policy, you will need to pay a higher premium to be protected against that condition as well.
Another factor that impacts your premium is how much coverage you need. If you want to receive higher coverage in the future, make sure to let your insurance agent know so they can include that in your insurance policy.
One of the major benefits of critical illness insurance is that it doesn’t exclude the possibility of having other types of insurance along with it. For instance, you can combine it with your health insurance to get better coverage outside of the medical expenses.
Since medical insurance covers only the medical expenses and fees, you are left with a financial void you wouldn’t be able to fill without additional income: mortgage, rent, utilities, travel expenses or just everyday living costs. Critical illness insurance can help you cover all of this and give you a bit of financial stability when you’re left without a regular income source.
No, the money you receive through your critical illness insurance can also be used to cover all your expenses, including mortgage, utilities and any other living expenses you may have.
No, as long as you pay the monthly premiums, the plan will be active and you can receive critical illness insurance when you need it.
Critical illness insurance covers conditions diagnosed after the insurance policy is issued, so if you have any pre-existing conditions, you won’t receive coverage for them.
If the policy covers the critical illness of family members, yes, you will. Every policy has different provisions.
We all know that one of the most common reasons for bankruptcy in the United States is medical bills. The costs resulting from a serious illness can be financially devastating for the whole family, not just the person with the illness. Because of this, it’s important to protect yourself against this risk, and critical illness insurance is one of the best options for doing that.
As we mentioned in the start, critical illness is not something many think about often, but it can be the best thing to have if you or someone close to you experiences some severe illness. If nothing else, it will lift the financial burden of your back and let you focus on the healing process, something you can’t put a price on.