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What Are the Important Factors to Consider Before Buying Critical Illness Insurance Coverage?

Updated On Jul 20, 2021

A critical illness diagnosis is a life-changing event. A severe illness like cancer, paralysis, kidney failure and heart attack has the capacity to destroy one's spirit entirely. Meanwhile, huge expenses related to hospitalization, treatment and medical bills can drain the patient's life savings. Here, comprehensive critical illness insurance can be a lifesaver that will protect you from financial loss. Let's learn more about different aspects of a critical illness cover. 

What is a Critical Illness Insurance Policy?

In the event of a diagnosis of one of the listed critical illnesses, the insurance provider will provide a lump sum amount to the life assured under the critical illness insurance policy. This fixed, predetermined amount can be used to pay hospital and medical treatment bills.

What are the Important Factors to Consider Before Buying Critical Illness Insurance?

Before purchasing critical illness insurance, consider the following five important factors.

1. Covered Illnesses

Certain companies provide risk coverage for various severe illnesses. Some companies may provide critical illness coverage for up to 20 different diagnoses, while others may only cover up to eight. Some diseases include cancer, kidney ailments, heart attacks, high blood pressure, diabetes, asthma etc. Moreover, situations that are not covered by the policy are referred to as exclusions, and understanding them is equally important as knowing about the critical illness that is covered. As a rule of thumb, look through the policy provisions carefully to comprehend the policy's exclusions. 

2. Coverage 

It is wise to choose a critical insurance plan with maximum coverage to ensure that the high medical bills of diagnosis, hospitalization, medicines, treatment and post-hospitalization care can be cared for. Moreover, you can also consider including benefits like ambulance cover, dialysis, second opinions and organ donations in your critical illness insurance policy.

3. Pre-Existing Illness

While some insurance providers will cover pre-existing illnesses after a 3- to a 4-year waiting period, the majority of firms may not cover them in any way. Hence, it is important to carefully compare different policies provided by various insurance providers to get the policy according to your needs and requirements.

4. Waiting Period

The period of days/years that the policyholder must wait to acquire critical illness coverage is referred to as the waiting period. It is advisable to double-check the waiting period, as making a claim before that time will render you ineligible for coverage. In the case of critical illness, it is generally around 90 days since policy inception. On the other hand, in the case of a pre-existing disease, the limit is about 48 months. It is advisable to choose a plan with a low waiting period. 

5. Policy Renewal Age

It is advisable to determine the age up to which the coverage will be provided for a critical illness, i.e., when the policy can be renewed, before purchasing a critical illness insurance policy. While some insurance providers offer life coverage up to a specified age like 60 years, others, especially the plans for senior citizens, can provide coverage for life long.

Take Away

If you're looking for critical illness insurance to secure your future, you'll need to do some comparison browsing and research to find the best policy for you and your family. In the case of critical disease, cost should never be the primary consideration when making a decision.

Also Read: Term Insurance vs Traditional Life Insurance: Benefits Compared

What are the Benefits of Group Term Life Insurance Plan?

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.

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