Critical Illness Insurance: Understanding the Features, Benefits, and Why You Need It

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Many people are unfamiliar with critical illness insurance and confuse it with standard health insurance. However, in the event of a major medical emergency, such as a heart attack, stroke, or cancer, critical insurance comes in handy and saves you from financial ruin. According to the Indian Council of Medical Research (ICMR) report, India is expected to have more than 1.5 million cancer patients by 2025, a whopping increase of 12%.

The stressful nature of our lives, combined with an unhealthy diet, lifestyle, and pollution, are major contributors to our susceptibility to life-threatening diseases. While the rise in serious diseases is concerning, equally distressing is the amount of money needed to combat the diseases. This is why having a critical illness plan becomes important. If you are in a dilemma about whether to buy a critical illness plan, read on.

What is Critical Insurance?

Critical Insurance is a plan that pays out a fixed amount to the policyholder upon diagnosis of a life-threatening disease. The sum insured is provided to take care of the medical and treatment cost of the disease covered under the plan. It does not necessarily require hospitalization and only medical reports are sufficient for policy to kick in provided the insured clears the waiting period.

Some of the important features of the critical illness policy are:

Extensive Coverage

It offers comprehensive coverage for a wide range of fatal diseases. However, it is necessary to check the critical illness cover with the insurance company before purchasing.

Lump-Sum Payment

Upon diagnosis of the disease, the insurance company provides the policyholder with a lump-sum payment to cover all types of medical expenses.

Easy Claim Process

The submission of medical reports is sufficient for the claim to be approved.

Waiting Period

The policy comes into effect after the waiting period. The waiting period is usually 90 days, but it varies depending on the company.

Loss of Income

A portion of the sum assured can also be received in instalments as income replacement.

An applicant can research and evaluate different critical illness policies offered by various companies. Furthermore, by using an online critical illness premium calculator, selecting the best plan suitable becomes easy.

What is Covered by Critical Insurance Plan?

The plan protects the policyholder financially from a variety of potentially fatal diseases. The following are some of the diseases that necessitate extensive medical attention and treatment:

  • Stroke
  • Heart attack
  • Cancer
  • Organ transplant
  • Parkinson’s disease
  • End-stage liver or lung disease
  • Major burns
  • Muscular dystrophy
  • Multiple sclerosis and more

The cost of treating such illnesses is out of reach for the vast majority of working people. The financial burden of fighting such dreadful diseases cannot be met by your standard health plan and will quickly deplete all your savings. It is, however, important to check properly about the diseases covered under the policy before buying.

Why You Should Get a Critical Illness Plan?

There are several benefits of buying critical care insurance to the policyholder. Some of the advantages are:

  • One advantage is that it pays for diseases that are not covered by traditional health plans.
  • The money provided in a lump sum can also be used for non-medical expenses such as debt repayment, monthly bills, and so on.
  • The funds can also be used to purchase equipment, transportation, nursing costs, and other things necessary for recovery.
  • If you have a family history of any fatal disease, buying critical illness insurance is a prudent decision.
  • The policy also serves as a tax-saving tool under section 80D of the IT Act, 1961.

Medical costs can wipe out all your savings quickly. Make sure to protect yourself and your family with the right insurance policy.

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