What to look out for when buying critical illness insurance


Critical illness is not something we’d like to face at any point in our lives. Because the risk of getting ill can never be eliminated completely, it’s important that we take precautions so that you’re able to make the financial choices required to make a difference when needed most. Securing the right insurance now while you’re healthy is one way to cover some of the unexpected expenses that could arise as a result of a critical illness.

Leading causes of critical illness claims?

70% – Cancer
14% – Heart attack
5% – Stroke
5% – Other
4% – Coronary artery bypass surgery
2% – Multiple sclerosis

Sadly, critical illness can affect any one of us, no matter what age or gender. It usually strikes when we expect it at the least, and it unfortunately does happen to many. Canadians are more likely to experience a critical illness than they are to die before the age of 75. Critical illness insurance pays a lump sum benefit following the diagnosis of one of the covered illnesses. It offers you choices and allows you to recover on your own terms without having to search for additional financial choices to cover all the expenses. With this type of insurance, you may afford medicine and treatments that are not covered by group, personal or government plans. You will be able to replace lost income and maintain your business until you can return to work.

Critical Ilness Insurance Claims Table

Example of the benefits paid for critical illness insurance claims

When looking for buying such policy, make sure your broker answers questions related to the points below:

  • Financial coverage. The amount of critical illness insurance you can purchase and the age of the insured person varies from company to company. Ask your broker to find out and suggest what is most beneficial for you.
  • Type of protection and durations. Is the amount of coverage fixed or does it decrease as time goes? Also find out whether the premiums increase over time. Term policies allow you allow maximum short term protection according to your available budget. Many policies also offer a return of premium option if a claim is not made.
  • Illnesses covered and restrictions. Find out if all the standard medical conditions are covered by your insurance policy, for example: Heart attack, stroke, coronary artery bypass, cancer, kidney failure, organ transplant, major organ failure on waiting list, multiple sclerosis, blindness, deafness, coma, Alzheimer’s disease, Parkinson’s disease, speech loss, loss of limbs, paralysis and so on. For restrictions, find out the number of days the condition is required to persist for you to be eligible for the claim. As an example, some insurance companies require 180 days in the case of paralysis, while others only 90.
  • Exlusions. Almost all contracts on the market are being systematically updated with other exclusions, such as self-mutilation and cancer diagnosis within the first 90 days of the contract taking effect.