Critical Illness insurance financially protects you and your family from the out of pocket medical costs, lost wages, household bills, and helps you continue paying for your health insurance to cover necessary treatments. Even if you have the best health insurance coverage possible, a critical illness diagnosis can have a devastating impact on your financial stability.
What is Critical Illness Insurance?
Critical illness insurance is in addition to your main health insurance coverage. Your health insurance policy pays bills at medical facilities, where as your critical illness insurance pays you. The most popular type of CI policy will pay you a lump some benefit upon the diagnosis of a critical illness, but there are other variations of disbursement.
A Critical Illness insurance policy will pay you directly so you can use the funds however you see fit. The most common uses of the critical illness benefit are:
- Pay the out of pocket medical costs like your deductible and copays with your health insurance policy.
- Replace lost wages from missing work
- Pay household bills like your home payment, electricity, car payment, etc.
- Continue being able to pay for your main health insurance to ensure you are able to stay covered for necessary treatments.
What is a Critical Illness?
The “big three” critical illnesses are cancer, heart attack, and stroke. However, there are a lot more that are sometimes included in the definitions of a CI insurance policy. Some critical illness policies can include the following, but always check with your health insurance agent to know what your policy covers.
- Invasive / Non-Invasive Cancer
- Heart Attack
- Stroke
- Kidney Failure
- Coma
- Blindness or Deafness
- Major Organ Transplant
- Paralysis
- Loss of Limb
- Major Burns
- Coronary Artery Bypass Graft
- Advanced Alzheimer’s
- Heart Valve Surgery
Is a CI Insurance Policy Worth It?
Short answer is yes. Some estimates say that 1 in 2 women and 1 in 3 men will develop cancer in their lifetime. The American Cancer Society says that Females have a 38% chance and Males have a 40% chance of developing an invasive cancer. After factoring in non-invasive forms, the overall odds of developing any type of cancer increase drastically. And the risk of dying from an invasive cancer is 21% for men and 18% for women. Your health insurance policy should cover most of the medical costs, but you are left paying for your deductibles each year, you still have your household bills, the cost of your health insurance, and the cost of traveling family members. Money won’t fix the cancer diagnosis, but the benefit from a critical illness insurance policy does help with the financial burden that comes from the situation. It alleviates the financial stress, so you can focus on the treatments and healing.
…And that’s just about cancer, which is the #1 feared critical illness at about half the population concerned they will develop it. Don’t forget all of the other critical illnesses that a policy would cover. The overall odds of having any sort of critical illness diagnosis in your lifetime is unfortunately very high.