Be Financially Prepared For Any Critical Illness
Insurance Plan Advantages
Given the fact that a serious or critical illness can strike you any time and maybe without any warning, it is best to be financially secured to face any such eventuality. You can do this by opting for a critical illness insurance policy
In the current scenario, every individual is facing inimitable kind of stress in his or her life, be it personal or professional or be it emotional, financial or physical. These stress factors are inescapable. However, what you can escape from is financial stress by pre-planning your finances and considering various risks that you might face in your future. No one can predict what you might have to undergo in your future and therefore you should at least be financially prepared so that you can lessen the financial and emotional burden. One of the risks that haunt everyone is that of getting ill, which affects the ability to work and also degrades the health of a person.
If any person gets critically ill there are a lot of medical complications that he or she may have to face due to which he or his family is likely to face emotional and physical breakdown if not planned for adequately. Serious illness affects the working ability of the individual which might lead to temporary or permanent loss of job, which can lead to a huge financial burden. Thus, how should one protect oneself financially if hit by any such illness? The answer is to get insured against any such eventuality. A life insurance policy comes into play on actual death. Nevertheless, the critical illness policy pays during instances that can bring ‘financial death’ to a person.
A critical illness can disrupt the life of a person as he might have to give up on his goals and dreams and the medical cost can wipe out all his savings. There is one answer to these problems – a critical illness insurance plan. Critical illness plans cover various serious illnesses such as cancer, paralysis, heart valve disease, stroke, renal failure, coronary artery disease, etc. The key features of a critical illness insurance policy include:
1. Lump Sum Payment: A critical illness insurance policy pays you in lump sum in case you are diagnosed with any of the critical illnesses listed in your policy document.
2. Waiting Period: No claim for compensation will become payable if a critical illness, as specified in the policy, manifests during the first 90 days of the inception of the policy.
3. Lifetime Renewability Benefit: Majority of critical illness insurance plans come with lifetime renewability benefits. This means that you can renew your critical illness health insurance policy until lifetime provided you pay the premium for it on time.
4. Critical Illness Coverage: The coverage is offered for up to 36 critical illnesses such as heart attack, cancer, kidney failure, stroke, coronary artery diseases, heart valve disease, etc.
5. Tax Benefits: Policyholder can avail the tax benefits on the premium paid for critical illness insurance plans under Section 80D of the Income Tax Act, 1961.
Insurance Plan Advantages
There are certain clear advantages of a critical illness insurance plan, such as:
• Covers Treatment Cost: The benefit amount is payable once the disease is diagnosed and meets specific criteria and the insured survives 30 days after the diagnosis.
• Easy Claim Process: Claim can be simply processed based on the diagnosis reports of the policyholder.
• Income Replacement: In case of critical illness, the policyholder gets a lump sum amount that he or she can use to cover medical or any household-related expenses.
• Covers Treatment Abroad: The policyholder gets a lump sum amount on diagnosis, which he or she can use to get treated as per his preference in India or abroad.
Exclusions
• Any critical illness for which care, treatment or advice was recommended or which was first contracted before.
• Any critical illness diagnosed within the first 90 days.
• Death within 30 days following the diagnosis of the critical illness.
• Presence of HIV or AIDS infections.
• Treatment arising from or traceable to pregnancy or child birth, including caesarean section and birth defects.
• War, invasion, act of foreign enemy, terrorism, hostilities, civil war, rebellion, revolution.
• Self-inflicted injuries such as suicide or attempt to suicide.
Buyer Profile
So who should buy a critical illness policy?
• Individuals having family history of critical illnesses. Generally, critical illnesses are genetic. For example, if in your family there is a history of heart attack or heartrelated diseases then there is a high chance of you getting the same from your family. For such individuals it is highly recommended to purchase a critical illness insurance plan.
• An individual who is the sole bread-earner of the family. For such persons it is highly recommended to purchase this policy on account of the likelihood that the person’s entire savings may otherwise be used up to pay for medical costs along with a drying up of any further income for some time.
• Individuals who are above 40 are more prone to critical illnesses and generally heart attack. Therefore, it’s better to purchase such a plan while in the early forties.
Choosing the Right Policy
In India, various insurance companies offer critical illness insurance plans. So, the common question is about which insurance plan is best suited for one’s needs? A critical illness insurance plan offers the full sum insured irrespective of whether one is hospitalised or not subject to diagnosis of the critical illness. Nevertheless, details differ plan to plan. One should look at the parameters beforehand, including:
1. How many numbers of critical illnesses are covered in a particular plan? For example, Aviva’s Health Secure provides protection against 12 major critical illnesses, ICICI Prudential’s Crisis Cover protects against 35 illnesses, etc.
2. One should review the claim settlement ratio of the company in order to gauge the percentage of claims an insurer has settled during the financial year.
3. Compare the premium charts of different insurance companies and choose a company which offers high cover amount and low premium.
4. One should also take a look at how many policies an insurer has sold. Given that the corona virus pandemic is the latest disease to have hit the world, it is important to see if this is included in the list of the insurer.
Conclusion
Life is unpredictable and uncertain and you may face a sudden medical emergency any time. Therefore, it is prudent to pre-plan your finances in order to lower down the financial burden in case you get hit by any serious illness in the future. The medical industry is growing at a fast pace which is the major reason for higher medical cost. Hence, be an informed and sound individual and protect yourself and your family against such financial uncertainties.