Know the Factors to Consider while Buying a Critical Illness Policy
Updated On Jan 30, 2024
Is your car more important than your health?
No, right?
Why then do you buy car insurance and not critical illness insurance?
Is this just because car insurance is compulsory?
A health insurance plan is even more vital because it protects you against all critical health issues.
Your health carries its impacts on almost all phases of your life. If you are healthy, you can plan for a better future.
Therefore, an insurance policy for your health is among the most powerful tools.
Also, it can be the best gift you can offer to you and your family.
Table of Contents
What is Critical Illness Policy?
In general, critical insurance is a type of plan designed to pay a tax-free lump sum in case of critical illness diagnosis during the policy term.
However, a critical illness policy isn’t a substitute for your basic health insurance. It adds an extra cover to your regular mediclaim policy or insurance product. It is the best option because it can provide you with the proper coverage for any life-threatening diseases.
Why You Need Critical Illness Health Insurance?
Medical costs are rising at a higher pace. Getting the best treatment for critical ailments is not easy, cheap, and convenient. It takes a good amount of time and money. Therefore, a comprehensive health insurance policy is the right bet.
Assume that you are the only earning member in your family. And unfortunately, you’re diagnosed with a major illness, such as cancer, stroke, etc. In that case, you would probably like to quit your job to get specialized care.
This can cause you to lose monthly income, and increase expenses. In such an event, a critical illness policy can be your best friend.
I already have a health policy, so I don’t need a separate critical policy
Does this sound similar?
Many people think that they don’t need critical insurance because they already have a health policy. But, simply investing in a health policy is not sufficient for you due to the following reasons:
- Your health plan may not cover all expenses
- It may have a limit on doctors’ fees
- It may have a cap on specific expenses like medicines, and intensive care.
- Or, it may not cover the full cost of treatment.
So, your health policy may not be enough. In that case, you’ll have no option but to either break your savings, borrow money from others, or pay the medical bill from your pocket.
So, buying a critical illness policy is the best solution. It will cover your family and yourself against all medical expenses incurred on acute ailments.
The best critical illness policy includes the following benefits:
- Coverage for medical and household expenses
- Tax-free under Section 80D of the Income Tax Act
- Enough funds are available in an emergency, so you can concentrate more on medical treatment
- Coverage for overseas treatment
Things to Consider While Buying a Critical Illness Insurance Policy
Listed below are some important factors in buying the best critical illness policy. Follow these tips and you will be able to shop for a comprehensive critical illness policy.
1. The List of Illness Included
It’s important to look at the list of all critical illnesses covered in your policy. In general, different insurers provide risk coverage for different critical illnesses. Go through the policy wordings, terms, and conditions and understand all the exclusions in the policy.
2. The List of Illnesses Excluded
Like knowing the inclusions, taking note of things not covered under your critical illness policy is equally important. As a thumb rule, read the policy details carefully and understand the exclusions of the policy.
3. The Right Size
Before making any decision, it’s essential to know what the insurance company is charging. If you are aware of all the benefits offered, you can easily decide how much protection you need. Consider the factors like recurring costs, future financial liabilities, and treatment costs in case of income loss.
Medical history and age are also vital to know when you decide the appropriate sum assured. Be sure the sum assured offered by the company is higher if you are aged, as you are more likely to develop chronic ailments. Moreover, have a look into accounting existing covers like personal accident, mediclaim, and disability insurance policy.
4. Your Health Condition
Your present health plays a vital role when it comes to deciding whether to buy a critical illness policy or not. A person - who smokes and lives a hectic work life - is more prone to vulnerable health problems in the future. It’s, therefore, good to choose the best critical insurance policy early so that you can’t encounter too many hassles.
Buying a Special Critical Illness Insurance Plan?
Some critical illness plans are available for special groups like senior citizens and women. Such policies are designed keeping in mind the needs of these people.
To take an example, Bajaj Allianz has a women-specific plan. This plan provides coverage for ovarian cancer, cervical cancer, and breast cancer. Also, a 50% sum assured is paid for the insured's child's congenital disability. Further, the policy provides bonuses for children's education and in case of job loss.
But, these plans are slightly costly. Because, when you choose a woman-specific plan for a 30-year-old woman from Bajaj Allianz, you can avail of a cover of 2 lahks.
On the other hand, if you choose to purchase a standard critical illness policy with a higher sum assured of Rs 3 lakh from Bajaj Allianz, the cost will reach Rs 900 a year.
Financial Standing
Even if you have a good financial situation and can combat any unpredictable health issues, a critical health plan will be helpful. You can go for a plan with smaller coverage. This is because healthcare costs are rising by leaps and bounds and further inflation in the healthcare sector is inevitable.
The Complement of Health Policy
When you choose a critical illness plan, make sure it complements your health insurance policy to get adequate coverage at an economical price. Both plans should cover aspects of health care. This is how you can keep your health insurance portfolio secure.
Critical Illness Health Insurance Claim Procedure
Understanding the procedure of filing a claim is another area of concern. This is important for any insurance product. Doing so will allow you to understand in advance about documents and formalities you would require when filing a claim.
Age Coverage
Before you make your purchase decision, it is pivotal to know to what maximum age the policy will provide coverage for critical illnesses.
Final Words
A critical illness insurance policy is extra insurance for life-threatening ailments if you have purchased comprehensive health insurance. It provides you with additional layers to your health insurance.
Thus, a critical illness policy is no less important than your car insurance. If you can buy insurance for your car, you can buy a health policy too. Consider the above factors and buy a critical insurance policy wisely to live a healthy life!
