When you are being treated for a critical health issue, it can be very costly. Often, it can cause so much financial stress that a patient may be forced to file for bankruptcy. This is why critical illness insurance can be so important for families and individuals during this time. You shouldnt have to worry about medical bills when you are caring for a family member.
What Is Critical Illness Insurance?
The three most common health incidents that are considered catastrophic are stroke, cancer, and heart attack, but some policies may also include kidney failure, paralysis, and even major transplants of organs. This type of insurance is considered to be a health insurance supplement. Since most of the people that are filing for bankruptcy due to medical bills have insurance, this is an important supplement to consider.
How Does Critical Illness Insurance Work?
A policy of this type is paid out as a lump sum to the person insured if they are diagnoses with a catastrophic illness that is covered in the policy. After the diagnosis is affirmed, the plan sends the insured a lump amount of money that is tax-free. If, however, the plan states that the insured must survive a certain number of days after diagnosis, this time will have to be met before a lump sum can be distributed. This time period varies from anywhere between 14 and 30 days.
Different Coverage Types
Critical Illness Policies will have differences concerning what will be covered and how much is paid out. Policies will normally offer a lump sum payment of anywhere from $5000 to $50,000, depending upon the plan. The higher the payout that can be given, the higher the premiums.
The most obvious benefit that you will receive is being able to take care of the costs that come with fighting a serious illness. It is not just about the medical issues, there are other costs that are associated with a prolonged illness, including normal living costs.
If you have been offered a critical illness policy with your existing health insurance, it is a small cost to pay for having this backup in case of illness. Consider it for yourself.