Your Complete Guide to Critical Illness Coverage

Find Your complete Critical illness Insurance Coverage comparing all companiesUnless you’ve been hiding in a blanket for the last decade, you’re already of crippling health costs on the rise.

But most alarming is where most of that cost is attributed:

A whopping 50% of US healthcare costs are used by the top 5% most medically ill individuals.

In addition, the treatment of critical illness could even lead towards bankruptcy as stated by a study carried out by Sunlife Insurance.

So what is critical illness insurance, and what kind of critical illness coverage can you receive?

We’ve dug into the specifics, taking out insurance jargon and simplified this complex topic to help you make an informed decision.

The Bare Bones of Critical Illness Insurance & Its Impact

Critical illness can be defined with a simple example.

Suzanne, a single mother and aged 40, is at her workplace conducting a meeting when she feels severe pain and pressure in her chest and is soon rushed to the hospital. The doctors confirm that she has been struck by a heart attack. This leads to a long period of intensive care in the hospital and complete rest. She needs a long period of recovery and her life suddenly is put on hold.

Any such illness or condition that severely and negatively influences the life of an individual – as it did with Suzanne – is called critical illness. Such illnesses and conditions will hamper your daily routine and your life will suddenly be at a standstill.

The expenses incurred as a result of such critical illnesses are also beyond the means of individuals and are quite different from the usual illnesses’ treatment costs.

For example, cancer drugs’ prices have doubled from $5000 to $10,000 per month according to 2014 survey published in Journal of National Cancer Institute.

Similarly, the costs of treating different heart conditions include $16,500 for each day of hospital stay, Cardioverter Defibrillator (ICD) procedure varying from $30,000 to $50,000 per implant and heart surgery varying from $30,000 to $120,000.

This is where critical illness coverage comes into play and protects you.

It works as a shield against all the out-of-pocket expenses you may face at such hard times.

What Is Critical Illness Coverage & How Can It Be Used?

Dr. Marius, a successful and celebrated surgeon came up with the idea of critical illness coverage in South Africa in 1980s.

He had a clear picture of how a critical illness could cripple a family and put a huge dent in their finances.

The impact was not felt by the patient alone.

The empathetic nature of Dr. Marius forced him to come up with a solution. He wanted to be able to serve his patients not only as a doctor but also as a humanitarian. This was followed by a round of meetings with various insurance companies.

He proposed his idea and fought for his patients’ welfare.

It is a well-known form of insurance and is now available in more than 50 countries. The critical illness coverage provides the insured individual with a lump sum amount. This amount is given to them at the time of diagnosis. If the patient survives a particular period after this diagnosis is made, he/she is given the amount promised.

This amount is given not to the hospital or any medical institution but instead to the insured person. This made it easy for him/her to cover both his medical and non-medical related expenses.

In case of the above-mentioned example of Suzanne, since she is a single mother, she will be under a lot of pressure both emotionally and financially. Getting timely assistance from the critical illness claim means she can focus on her health and recovery. She can use this amount for buying groceries and paying for her child’s expenses without added worries.

Even though we take our health for granted, you never know when a disaster might strike and that is when critical illness coverage will come to your rescue.

What Illnesses Do Critical Illness Coverage Include?

Initially, critical illness coverage only included a few main illnesses. This included hHeart-related conditions such as heart attack and coronary bypass surgery and other severe conditions like stroke and cancer.

However, with a vast progression in the critical illness coverage over the years, a lot of other medical conditions have been included in the list of illnesses successfully covered. A detailed list collected with the assistance of various insurance companies operating can be viewed below:

Initially, critical illness coverage only included a few main illnesses. This included heart-related conditions such as heart attack and coronary bypass surgery and other severe conditions like stroke and cancer.

However, with a vast progression in the critical illness coverage over the years, a lot of other medical conditions have been included in the list of illnesses successfully covered. A detailed list collected with the assistance of various insurance companies operating can be viewed below:

First, only heart attack and bypass surgery were included but now various heart conditions and procedures mentioned below are covered:

  • Aorta graft surgery
  • Cardiac arrest
  • Cardiomyopathy
  • Coronary artery bypass grafts
  • Heart valve replacement or repair
  • Progressive pulmonary hypertension
  • Structural heart surgery
  • Pulmonary artery surgery

With time, more variations of cancer are now being covered by the insurance companies through critical illness coverage and cancer insurance coverage. These include:

  • Benign brain tumor
  • Various cancer types
  • Benign spinal cord tumor
  • Non-malignant pituitary tumor
  • Carcinoma in situ of breast, cervix or testicle.
  • Cancer vaccine benefits

It should also be noted that certain types of cancers like skin cancer will not be covered by insurance companies. It is advisable to get to know more about the terms of your particular insurance policy. This will ensure that you won’t face any problems later on.

Other illnesses and medical conditions covered are:

  • Kidney failure
  • Alzheimer’s disease
  • Liver failure
  • Dementia
  • Major organ transplant
  • Aplastic anemia
  • Encephalitis
  • Bacterial meningitis
  • Pneumonectomy
  • Blindness
  • Progressive supranuclear palsy
  • Coma
  • Severe lung disease
  • Creutzfeldt-Jakob disease
  • Traumatic brain injury
  • Deafness
  • Arteriovenous malformation (AVM) of the brain
  • Loss of hand, foot, speech, independence
  • Bladder removal
  • Devic’s disease
  • Removal of an eyeball
  • HIV infection
  • A cerebral aneurysm
  • Paralysis of a limb
  • Motor neurone disease
  • Multiple sclerosis
  • Multiple system atrophy
  • Parkinson’s disease
  • Stroke
  • Spinal Stroke
  • Terminal illness
  • Crohn’s disease
  • Third-degree burns
  • Ulcerative colitis
  • Rheumatoid arthritis
  • Systematic lupus erythematosus

The Variations and Types of Critical Insurance Coverage

What initially started as a simple system of providing financial aid to the people suffering from critical illnesses is now a sophisticated form of insurance. It has various types described as follows:

Basic Critical Insurance Coverage: Under this policy, you get the advantages of critical illness coverage only. Once you are diagnosed with a critical illness, you will get a certain amount keeping in mind you survive a 30 days period. You can use this amount for any expense. Once you have made a successful claim, this policy will end.

Critical Insurance Plus: A Critical Insurance Plus plan is a combination of two separate policies which are life insurance policy and critical illness insurance policy. This is a cheaper alternative. You can use this policy once only. It can be claimed either with the death of an insured person or when he/she is diagnosed with a critical illness. Once this policy is used, it will expire.

Critical Illness Rider: This is an extra beneficial favor you can take along with your life insurance policy. It gives you the added benefit of claiming your critical illness rider. This will not end your life insurance policy as a result.

You can buy back this added feature on your life insurance policy if your insurance company policy states so. Once you are affected by a critical Illness, this is the only way to get other critical illness coverage.

Severity Based Critical Illness Coverage: This policy will not give you the whole lump sum amount. Instead, it will provide a certain percentage of the whole payout. This percentage will depend upon the level of severity of your critical illness. The remaining amount can be used later on.

Cancer Insurance Coverage

A cancer insurance coverage is a relatively new type of insurance in the market. It was introduced because of an increased rate of cancer patients in the US in the current scenario. It is stated that 1 in 2 males and 1 in 3 females will face cancer once in a lifetime.

A cancer insurance coverage is the same as critical illness coverage because it too pays you a lump sum payment with the diagnosis of cancer. These medical payments can then be used to offset various medical expenses like copays, out-of-network medical costs, and deductibles that are not met by your health insurance plan.

Similar to the critical illness coverage, same limitations of treating certain types of cancers apply to cancer insurance coverage too. The amount you get can be used for any expense you deem fit and the critical illness coverage doesn’t limit your options like cancer insurance coverage.

Coverage of Various Insurance Companies

You can get a lump sum amount of around $10,000 to $1 Million depending upon your particular policy. Similarly, which illnesses you will be covered against will vary from company to company.

Aflac

Aflac provides a benefit of $15,000 to $30,000 for the insured employee. It allows up to $7500 to $15,000 for the spouse in case of a diagnosis for the critical illness mentioned in the policy. Its policies will cover you and your dependents. You can take this policy with you in case you leave your current place of employment (with certain stipulations). It promises fast claims that will be processed within 4 days.

Allstate

Allstate provides a vast coverage which can be increased in small increments of $5000 ranging from $5000 to $20,000 and above. It will provide a comprehensive coverage for you and your family.

Metlife

Metlife Insurance provides a coverage of $10,000 or $20,000 and half the coverage of these amounts for dependents. It gives you the opportunity of getting 300% of the initial benefit. The initial benefit is the first benefit you get in case of a diagnosis. You can reap the profits of recurrent and initial benefits till you reach the 300% limit. A suspension period will follow for a certain time after taking a certain benefit. You can take this policy with you after leaving the place of employment (with certain stipulations) by informing the company beforehand.

United Healthcare

UHC insurance provides a varied cover for all of your needs and keeping the criteria of affordability in mind.

Note: The premiums and coverage are subjected to change and might not be similar to rates quoted here. Certain companies give an initial benefit and certain companies believe in giving a recurrent benefit for critical illness mentioned in their policies. The premiums are usually deducted through payroll. Age, medical history and lifestyle will pay a significant role in premiums you will pay for a policy.

How do I Determine if I Qualify for Critical Illness Insurance?

There are a number of determinants on the basis of which you can know whether you qualify for critical illness coverage.

It is very important to know them beforehand.

Life Style: Your lifestyle choices will show if you qualify for critical illness coverage. If you have habits like smoking, overindulgences of alcohol and use of drugs, certain insurance companies might not qualify you for critical illness coverage. This is because these habits increase your risk for cancer and thus critical illness coverage will not apply.

Pastimes, Activities & Hobbies: A critical illness policy will not cover you for any problem faced due to certain activities and/or hobbies like criminal activities or hobbies like racing, flying private planes, climbing etc.

Medical history: In case your medical history mentions the fact that you have already faced a critical illness in the past, chances are you won’t qualify for critical illness cover.

Age: For certain illnesses, you might not qualify for critical illness coverage depending upon your age.

In case you don’t qualify for critical illness insurance, here is what you can do:

  • Move towards other insurance policies.
  • You can get a life insurance policy with a critical illness rider.
  • You can get income protection cover which will pay you a monthly benefit in case of any illness or injury. It will help you manage a certain standard of living and in paying off various expenses.
  • It is best to plan out the safest way to maintain your savings and credit options. Have separate accounts for saving for health care and invest time in getting to know about various financial instruments and products.

Critical Illness Coverage – An Asset Worth Every Penny

In a time when diseases and illnesses are becoming more complex and costly, getting a safety net is not just a luxurious but a necessity. As mentioned we’ve mentioned before, your savings alone are not a reliable source to depend on in the time of crisis.

Critical illness coverage assures you great peace of mind.

It helps you to fill up the gaps that are left by a simple and straightforward health insurance plan. Imagine going through the added trauma of piling medical bills with limited safety policies. With critical illness coverage, you will always have an option and even a limited amount of $ 7000 or $ 10,000 can go a long way.

By |2018-07-10T21:42:00+00:00July 9th, 2018|Insurance Coverage|0 Comments

About the Author:

Matt has a strong background in writing and sees a ton of value in talking with insurance experts that know way more than he does. His own grandmother had a severe stroke several years back, and over the course of a few years, it completely drained her hard-earned retirement.

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