How critical illness insurance works

November 15, 2012 at 3:34 pm Leave a comment

Imagine for a moment what it would be like if you had suffered a serious heart attack last month… and survived! Could you continue to work and provide for your family? Would your life style or financial health be compromised? There is a solution that takes away the worry of surviving a critical illness… Critical illness insurance provides a hassle-free way to provide liquidity to meet the financial needs during a medical crisis.

Is critical illness insurance necessary?

Life insurance pays on death, or when the insured is terminally ill, with no long-term living benefits. Disability insurance replaces income, but is insufficient for the added burden of medical expenses. Personal and retirement savings have intended purposes, other than medical expenses. Long-term care insurance is too restrictive and inflexible. Many critical illness victims make a full recovery after a lengthy expensive treatment period.

  Serious illness statistics

  • Heart attack, cancer and stroke are the 3 most common diseases
  • 1 in 3 will develop some form of life threatening cancer
  • 30% of cancer victims are completely cured
  • 1 in 4 will contract cancer or heart disease before they retire
  • 1 in 2 heart attack victims are under age 65
  • 95% of heart attack victims survive the initial occurrence
  • 1 in 2 will contract heart disease
  • 1 in 4 currently suffer from cardiovascular disease
  • 70% of open heart surgery operations each year are coronary bypasses
  • 1 in 20 run the risk of having a stroke before age 70
  • 75% of stroke victims survive the initial occurrence
Conditions that could be covered

  • Alzheimer’s disease
  • Angioplasty
  • Blindness (total & permanent)
  • Cancer (life-threatening)
  • Coronary artery bypass surgery
  • Deafness (total & mp; permanent)
  • Heart attack (myocardial infarction)
  • Paralysis (2 or more limbs)
  • Permanent total disability
  • Stroke (cerebrovascular incident)

How critical illness insurance works

Select an amount of coverage from $15,000 to $500,000, providing medical evidence of good health. You choose the level of coverage that meets your needs. Should you contract a critical illness, the lump sum payment (30 days) will help you maintain your lifestyle and your financial health.

Taxation – Claim payments are received tax-free.

What to look for in the coverage

  •     Clear definitions (medical terminology)
  •     Comprehensive scope of coverage
  •     Short elimination period (30 days)
  •     Lump sum benefit payment
  •     Liberal underwriting

Illnesses such as heart attack, cancer and stroke can strike at any time, and of course, serious injury through accident can happen to anyone. Although most people recognize the need for life insurance to provide for dependents in the event of death, few have considered the consequences of surviving serious illness or injury, and the financial difficulties it can bring. The illness itself would be distressing enough, but the financial burden of trying to continue a normal lifestyle could be very difficult, if not impossible.

Critical illness insurance can provide that much needed financial security to live a full life. Many people think that insurance policies from life insurance companies only pay benefits following the death of a policy holder. It is time to re-examine a fast-paced and changing life insurance industry.

Unlike life insurance policies in the past, some of the new policies have critical illness insurance riders available to provide you with financial support following the diagnosis of a specified serious illness and/or disablement resulting from illness or injury. There are also stand-alone policies for those who do not feel a need for life insurance or have adequate life policies.

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