What is Critical Illness Insurance?

A cancer diagnosis, heart attack or other unforeseen health crisis could leave you unable to earn an income, adding financial stress to an already emotionally stressful situation. Unfortunately, your mortgage or rent payment and other monthly expenses will still need to be paid. On top of those obligations, medical bills can quickly pile up. If you aren’t able to work, you may not have the means to pay those bills.

Critical illness insurance is a policy that will pay out a benefit as a lump sum if you are diagnosed with a critical illness or condition specified in the policy. This can relieve or lessen the financial strain that can come with critical illnesses, so you can focus on getting better.

What are the advantages of Critical Illness Insurance?

The main advantage of a critical illness insurance policy is the peace of mind that comes with knowing you and your family will have cash available to cover your expenses in the event you become seriously ill. You get to choose how the money is spent: use it to pay for treatment costs that aren’t covered under your health insurance policy, to cover your monthly obligations, to replace your spouse’s income so he/she can care for you, etc. The choice is yours.

Can I afford Critical Illness Insurance?

Critical illness insurance can be surprisingly affordable, especially if you are young and relatively healthy when you purchase the policy.

When you weigh the policy premiums against the potential impact to your finances from not having coverage when you need it, buying a critical illness insurance policy just makes sense.

Do I qualify for Critical Illness Insurance?

Some policies offer simplified underwriting, meaning you may be asked a series of health-related questions and may not need a medical exam. For higher value policies offering larger lump sum benefits, you will need to qualify for coverage based on medical exams and tests. In general, most healthy individuals qualify for critical illness coverage.

Because this type of policy is designed to pay out benefits in the event you are diagnosed with a critical illness, you cannot purchase the policy if you already have a critical illness.

When should I buy Critical Illness Insurance?

Of course, none of us ever want to be diagnosed with any type of critical health condition, but there’s no way to guarantee that won’t happen. For a critical illness policy, your premiums will be based on your age, so purchasing a policy at a younger age can make the policy even more affordable.