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Protect Your Health with Critical Illness Insurance

What is Critical Illness Insurance?

Critical illness insurance is a type of insurance coverage which is designed to provide financial support should the insured person be diagnosed with one of the critical illnesses included in the policy. The benefits may be structured to be paid out in a lump sum cash payment or as a regular income. Most policies require that the insured survive a minimum number of days from the date when diagnosis was made in order to be eligible for payments.

History

Critical Illness Insurance was first introduced in South Africa on October 6, 1983 by Dr. Marius Barnard, known by the name dread disease insurance. Since then, it became popular and adapted by many insurance markets worldwide, including Europe, Australia, UK, and Canada. It also became popular in the United States due to the nationwide problem of inadequate health insurance. In 1983, only four conditions were covered by critical illness insurance, namely heart attack, stroke, cancer, and coronary artery by-pass surgery. Today though, there are a number of other diseases included in the cover:

  • Blindness
  • Deafness
  • Alzheimer’s disease
  • Multiple Sclerosis
  • Parkinson’s disease
  • HIV/AIDS contracted during operation or through blood transfusion
  • Major organ transplant
  • Limb paralysis
  • Terminal illness

Importance

  • Used to cover for daily living expenses so that those who are critically ill can focus on getting well rather than making ends meet
  • Used to pay for treatment costs not covered by insurance policy
  • Replacement of lost income due to disability
  • Can be used for transportation expenses to and from treatment facilities or for installing safety measures such as lifts or ramps for critically ill patients who have difficulty traveling
  • For those who are terminally ill, the benefits can be used to pay for recuperation costs or family vacations

Restrictions

Just like any other insurance policy, critical illness insurance has known exclusions that could limit or hinder payment of benefits. Payments will only be made under certain conditions specified in the policy. For instance, a diagnosis of stroke may not qualify for payment until the damage persists for more than 30 days, or a cancer diagnosis does not warrant payment if the cancer has not metastasized or is not considered life threatening.

In some policies, there are payout limits with regards to the age, for example, people who are over 75 years old become ineligible for payment. The policy may also include a specific number of days wherein the insured should be ill or should survive after the diagnosis is made.

Who Can Take Benefit from Critical Health Insurance?

  • Self-employed people
  • People with inadequate health insurance coverage
  • Persons who have high-risk jobs
  • Anyone who will be in need of financial support if illness makes it impossible to earn income

Factors that Could Affect the Price of the Product

  • Age and gender of the insured
  • Health condition of the insured
  • Family medical history
  • Amount and extent of coverage
  • Any known health risks or high-risks occupations and hobbies
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