A critical illness cover will provide you with a lump sum amount when you are diagnosed with critical illnesses like kidney malfunction, cancer, stroke, etc. to take care of the expenses incurred. In the absence of a critical illness policy, you will be financially drained in addition. to the emotional stress you go through. When you have a critical illness, you will be unable to work and provide for the basic maintenance of your family. Receiving a bulk amount from the insurer will help you cope with your expenses. This article gives you an insight into how to buy a critical illness policy with a life insurance/health insurance policy
Understanding Critical Illness Policy
Critical illness policy provides a lump sum amount to cover the treatment expenses arising out of specific critical illnesses as well as the recovery expenses. If there is any surplus out of the lumpsum amount received, you can utilise the funds to pay off outstanding liabilities and lessen your financial burden.
A critical illness policy cover expires once the lumpsum amount is paid. You are allowed to buy more than one critical illness policy. Each of the policies will pay a lump sum for the critical illness. You can combine a critical illness policy with life insurance as well as a health insurance policy. Critical illness includes heart/kidney diseases, cancer, stroke, etc.
Critical Illness Policy with Life Insurance Policy
Providing financial security to the policyholder’s family in return for the premium paid is life insurance meaning. A critical insurance policy along with a life insurance policy provides dual benefits. It provides for the treatment of a critical illness while continuing the life insurance cover. The critical illness policy with a life insurance policy can be in the form of a rider or as an independent policy. Two different riders with different premium rates are available. They are:
Accelerated Benefit: In this case, you can opt for a built-in benefit wherein the life insurance coverage will be reduced to the extent of critical illness coverage. If you are diagnosed with a critical illness a lumpsum amount to the extent of critical illness coverage will be released and the life coverage continues to the extent of the reduced sum.
Additional Benefit: Here, the sum assured for the critical illness will be added to the base sum assured. If a lumpsum is released for critical illness expenses, the amount will not be reduced from the sum assured in the life insurance policy. The life insurance policy will continue with the same sum assured.
If you buy an independent critical illness policy, the life insurance policy will provide financial security to your family and the critical illness policy will provide financial security against about 50 critical illnesses like heart and kidney issues, cancer, stroke, etc.
Critical Illness Policy with Health Insurance Policy
You can buy a critical illness policy along with health insurance as well. It can be in the form of riders to the basic health insurance policy at an additional premium or can be as an independent policy. The critical illness coverage in a rider will be for a defined number of illnesses which will normally be limited. It will also specify the lump-sum benefit payable and the waiting and survival period.
If you are diagnosed with a critical illness you can use both the critical illness and health insurance cover. Critical illness benefits can be used for the treatment and basic health insurance cover can be used for reimbursement of hospitalisation expenses. Medical bills for expenses incurred have to be submitted to the insurer.
You should be aware that standalone critical illness policies are portable whereas critical illness riders are not.
How To Buy Critical Illness Policy with Life or Health Insurance Policy
Here is how you buy a critical illness policy with either a life insurance policy or a health insurance policy.
- Select the term and sum assured of the base policy. This you can assess using the term insurance premium calculator to align with your affordability.
- Choose the critical illness rider depending on the financial security you need.
- Select the life insurance or health insurance plan and the critical illness cover.
- Fill personal information.
- Pay the premium.
- Fill out the proposal form. The critical illness cover form focuses on your lifestyle habits, medical history, family medical history, etc.
- You will have to undergo a medical test depending on individual life risks before the critical illness coverage is approved.
A critical illness treatment cost can erode your savings and drive you to financial distress. Combining either a life insurance policy or a health insurance policy with a critical illness policy will safeguard your income by providing for the treatment costs. The decision to include the critical illness policy with a life insurance policy or a health insurance policy depends on individual requirements.