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What is Critical Illness Cover & How Does It Work?

Posted On : 03 May 2023, 11 Months Ago. Health-Insurance
Critical Illness Cover

Critical illness health insurance is a type of insurance that provides financial support in the event of a serious illness. It is designed to help individuals and their families cope with the financial strain that often accompanies a life-changing medical diagnosis. This article will explore what is critical illness insurance and how it works.

 

What is Critical Illness Insurance?

Critical illness health insurance provides a lump sum payment if you are diagnosed with a severe illness. The payment is designed to help cover the cost of medical treatment and other expenses that may arise as a result of the illness. The lump sum payment can be used to pay off outstanding debts, cover living expenses, or any other costs that you may incur as a result of your illness.

 

Critical illness health insurance is different from other types of insurance, such as income protection or life insurance. While income protection provides a monthly income if you are unable to work due to illness or injury, critical illness cover provides a one-off payment. Life insurance pays out when you die, whereas critical illness cover pays out while you are still alive.

 

How Does it Work?

When you take out such a policy, you will pay a monthly or annual critical illness insurance premium. The cost of the critical illness insurance premium will depend on a number of factors, including your age, health, and lifestyle. The policy will set out the specific illnesses that are covered, which can vary between insurers. However, most policies will cover the same critical illnesses, such as cancer, heart attack, and stroke.

 

If you are diagnosed with a covered illness, you will need to make a claim on your policy. You will need to provide medical evidence to support your claim, such as a doctor's report or medical records. Once your individual health insurance has been approved, you will receive a lump sum payment from the insurer. The payment can be used in any way that you choose, whether that be to pay for medical treatment or to cover living expenses.

 

It is important to note that there may be exclusions or limitations on your policy. For example, some policies may not cover certain types of cancer or may have restrictions on the amount that can be claimed. It is essential that you read the policy documents carefully to ensure that you understand the terms and conditions of the cover.

 

What are the Benefits of Critical Illness Cover?

The main benefit of critical illness cover is the financial support it provides during a difficult time. A serious illness can have a significant impact on your life, both physically and financially. Obtaining a claim can help to ease the burden and provide peace of mind.

 

Another benefit of critical illness cover is that it can provide protection for your family. If you are unable to work due to your illness, income protection may not provide enough financial support to cover your family's living expenses. The one off payment from critical illness cover can help to ensure that your family is taken care of during a difficult time.

 

Is Critical Illness Cover Right for You?

Having discussed what is critical illness insurance, how it works, and its benefits, it’s important to check whether such insurance is suitable for you to buy.

 

Whether or not critical illness cover is right for you will depend on your individual circumstances. If you have significant financial obligations, such as a mortgage, critical illness cover may be worth considering. If you have a family to support, it can also provide peace of mind knowing that they will be taken care of if you are diagnosed with a serious illness.

 

It is important to note that the cost of a critical illness insurance premium can be high. You should carefully consider whether the cost of the cover is worth the potential benefits. You can use the critical illness insurance premium calculator for this purpose. You can also consider buying a standard health insurance with critical illness cover as an additional rider to save costs.

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