With critical illness insurance, you can get the support you need if a serious health crisis occurs. It’s not as popular as other insurance products but it’s necessary to buffer the financial misery that comes with costly treatment.
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While comparing regular health plans, you’ll discover there’s a limit to what they offer. Not all cater to serious medical conditions and when they do, they require additional premium.
However, you can avoid the extra cost of a policy upgrade by investing in the right plan. In this article, we’ll explore an insurance plan that specifically caters to life-threatening diseases.
What is critical illness insurance?
Critical illness insurance is a policy that reduces the financial burden on people suffering from severe ailments. This assistance only covers individuals with any sickness that is medically severe or catastrophic.
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Naturally, healthcare is expensive for citizens of the United States. People get deep into misery from the financial strain that comes with getting basic treatment. Imagine how much healthcare would cost for a sickness deemed critical.
Putting money towards this plan helps if you have lots of dependents or you struggle with low income. However, it may not be as useful for beneficiaries of an income protection plan
Although comprehensive plans cater to 34 grave sicknesses, the number may change to include medical emergencies. Here are some examples of ailments a critical illness insurance covers;
- Traumatic head injury
- Coronary bypass
- Heart attack
- Kidney failure
- Organ transplant
- Cancer
- Stroke
Also Read: What is Accident Insurance?
How does critical illness insurance work?
It is important to note that buying critical illness insurance does not guarantee a payout. Your sickness has to qualify as severe first.
Before accepting premiums, insurers need information on your medical background. The essence of this is to check for pre-existing conditions and charge accordingly.
As stated earlier, a health condition must be severe to qualify for critical illness insurance. For this reason, insurance companies have certified medical professionals verify the diagnosis before sending payouts.
After confirmation, you will receive a lump sum payment. However, there has to be a prior agreement on the exact amount to be disbursed.
Once the payment is made, the policy typically terminates. In other words, you can access these benefits just once.
Coverage features can vary between insurance companies; while some cover 34 diseases others extend theirs to include other medical emergencies. Insurers also factor in your medical record, age, and lifestyle when writing quotes.
After signing up, you get a 30-day grace period in case you want to dissolve your contract. This only stands if you’ve not made claims within the given period.
Benefits of critical illness insurance
Accessibility
Critical illness insurance policies do not usually cost a fortune to purchase. Due to their low premium rates, anyone can access them. Also, they are mostly included in workplace benefits making it even more accessible to a wider population.
Flexibility
Insurers have no control over how you spend your lump sum payment. This is different from regular health plans that make payments to treatment centers on behalf of their clients. With this policy, you can spend your money on whatever you deem fit
Peace of mind
The absence of any financial strain helps speed up your recovery process. Insurance takes care of your treatment cost and other essentials you need to get better. This does not just reduce stress but helps you focus on treatment.
Supplement plan
When it comes to protecting your health, it’s essential to have multiple options that cover all bases. Bringing it down to insurance, a critical illness plan serves as a supplement to traditional health insurance. This way, you have a fallback plan for features not covered in your basic plan.
Tax benefits
Lump sums do not attract additional charges. The benefits come tax-free. So you can spend without incurring penalties for failing on taxes
Conclusion
To conclude, you can also spend your critical illness insurance on non-medical needs. This means your lump payment can sustain you when you are unable to work. It’s important to seek guidance from a financial adviser or compare quotes from reliable insurers to determine the best step.
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