Is critical illness insurance a good idea?

Rajesh was a healthy 30-year-old lawyer. However, since there was a history of cancer in his family, he was very cautious while buying insurance. He had seen how his father’s treatment had left the family almost penniless and so he wanted to ensure the same thing didn’t happen if he was diagnosed with the illness. So he bought  illness insurance plan and secured his finances as well his family’s well being. 

A critical health plan is a very good type of insurance that provides financial assistance if the policyholder is diagnosed with a crucial illness. Take a look at this article to understand how a illness plan works and why you must opt for it.

What is a critical illness plan?                        

A critical illness plan is a kind of insurance where the policyholder is paid a lump sum amount of money if he or she is diagnosed with a crucial illness. The insurer provides a list of illnesses classified as illnesses when the policy is being bought. If the policyholder contracts any of the diseases during the policy period, he or she receives the monetary benefit and is free to use the sum in any way he or she wishes.

crucial ill health insurance is available as standalone plans as well riders along with health insurance plans and life insurance plans.

Benefits:

Let us now take a quick look at the benefits of a illness plan.

·         Provides financial support: This is the biggest advantage of buying a critical ill health plan. Getting diagnosed with a major illness like a stroke or a heart attack may be distressing, but dealing with the finances at such a time becomes all the more difficult. Healthcare costs are very high these days and without proper insurance, you can’t even think about getting treated at a good medical facility. And since the treatment of the crucial ill health cost a lot of money, a regular health plan is never enough. The sum assured from a crucial illness plan proves to be very handy at such a time.

·         Income substitute: As mentioned, the insurance provider doesn’t check how you are spending the sum assured you received from the critical health plan. So instead of just paying the hospital bills, you can also use the money to act as an income substitute if your illness leaves you temporarily or permanently unemployed.

·         Clear dues: You can use the money from your health plan to clear dues such as home loans, credit card bills, etc so that if something were to happen to you in the aftermath of the diagnosis, your family members would not be harassed by the lenders. This is yet another helpful advantage of a health plan.

·         Continue with your savings: If you have a health plan in place, you don't have to dip into your savings or prematurely break any investments to pay your medical bills. You can safely continue with your savings and deal with the medical bills with the sum assured you receive from the critical illness policy.

Points to remember before buying a critical illness plan

There are a few important points that you must remember before you buy a health insurance plan. They are:

1.     There is a waiting period associated with the illness plans. Different insurers have different specifications, but you have to wait for about three months from the time you buy the policy to make a claim. You cannot get the benefit if you already have the illness when you buy the plan.

2.     There is a difference between a standalone health plan and a plan rider. In a standalone critical illness policy, if a claim is made, the sum assured is paid out and the policy is terminated. In the case of a rider, the critical illness cover is paid but the principal health or life insurance policy continues to remain functional.

The bottom line:

It indeed is a very good idea to go for a critical health plan. With such a plan you are assured of a solid financial backup when you need it the most. So what are you waiting for? Buy a critical health plan today if you haven’t done so already and secure your health as well as the financial well being of your family.

Source:  Is critical illness insurance a good idea?