What is a critical illness policy?

A Critical Illness Plan can cover different medical procedures and illnesses depending on which insurer is chosen.

Insurance companies differ in the exact definitions of these conditions and procedures. It is therefore important to understand and read the policy words.

The Critical Illness Plans cover non-hospitalization expenses like doctor’s visits, medication, living expenses, and lost income for specific illnesses and procedures. 

The policy requires that an independent medical practitioner confirm this.

You must wait at least 90 days before filing a claim under a critical illness plan. This usually takes place within 90 days of the date your policy became active.

The survival period clause states that the insured person must live at least 14 to 30 calendar days from diagnosis to file a claim.

List of Critical Illnesses:

What is not covered by critical illness insurance?

Here is a list of items not covered by critical illness insurance:

Factors to Consider Before You Buy Critical Illness Insurance

These are just a few of the points you should be aware of.

Current Situation:

When considering purchasing a critical illness insurance policy, it is important to be practical. Consider your family structure, your age, and the dependents you have, especially your elderly parents.

It is possible to assume that you will need additional coverage in case of an unexpected healthcare emergency such as a heart attack if you have seniors or family members who are dependents.

Consider a policy for a critical illness that provides sufficient financial support.

Health Condition:

Your current health status could decide whether or not you buy a critical illness insurance policy. Regular smokers and those who have high-stress jobs are at greater risk of developing health problems soon. It is good to plan early to avoid future problems when purchasing insurance.

Financial Position:

Regardless of your current income, it would help if you considered the future when you plan to purchase a critical illness insurance policy. It is important to remember that healthcare costs continue to rise and will only get higher. Before you decide on the amount assured, remember all of these things.

Wide Coverage:

You should carefully choose a critical illness policy, even though it might not be your primary insurance plan. Before you decide on a policy, read the list of covered illnesses.

This will help you determine if the insurer will cover your most serious conditions. You should also read the terms and conditions carefully to understand the exclusions.

Supports your Health Insurance Policy:

Make sure you balance your insurance policy with critical illness coverage to get the best possible coverage for a reasonable cost. Both policies should be combined to cover all aspects of health care so that you can reduce stress about healthcare.

Pre-existing diseases:

Some plans provide coverage for pre-existing conditions after a waiting period. However, some plans don’t cover them. You should, therefore, carefully assess what is covered by the pre-existing clause.

The policy covers all critical conditions:

Before you buy critical illness coverage, one of the most important things is how many the policy covers critical conditions. Before you make a purchase, do your research.

Free-look period:

Most insurance companies offer a 15-day free-look period to allow you to reconsider your decision. If you feel that the plan does not meet your needs, you can cancel and receive a refund.

Built-in coverage:

Although a critical illness plan provides financial protection against certain life-threatening illnesses, many insurance companies offer additional coverage. This coverage can include child education benefits, complimentary medical check-ups, and personal accident coverage so your loved ones are not left behind during difficult times.

Survival period:

Critical illness policies usually include a 30-day survival clause. Some insurance companies might extend it beyond 30 days, depending on the illness. To claim the policy, the policyholder must survive for at least 30 days after being diagnosed with the disease.

Benefits

For a lower premium, you get high coverage:

A critical illness coverage is usually less expensive than a comprehensive plan because it covers a smaller number of specific diseases.

It includes coverage for a variety of critical diseases:

Insurance coverage will increase if there are more procedures and illnesses covered. However, premiums may be slightly higher.

This policy is not the same as a regular mediclaim insurance policy:

Mediclaim typically covers hospitalisation only, but critical illness coverage includes income loss due to inability to work.

A lump-sum payment is available:

Contrary to mediclaim, which pays out based on actual medical expenses, a critical illness plan will pay a lump sum upon settlement of the claim. You may also be able to reduce your premium by varying the terms of the policy agreement.

Based on diagnostic reports, claims are processed:

An independent medical practitioner will assess the payout amount because it is substantial. Before settling a claim, the insurance company may request a second opinion to confirm that all conditions have been met.

Before you can file a claim, there is a waiting period:

The coverage is more effective if there is a shorter waiting period.

There is a period of survival:

Before making a claim, the insured must survive for seven days following diagnosis. The coverage will be better if this period is shorter.

Income replacement:

You can use a portion of the lump sum to replace the insured income.

You will most likely miss work if you have a serious illness. Your family will be financially affected if you lose your income. The lump-sum payment you receive is a source of income replacement and serves as a financial safeguard against financial ruin.

Payouts exempt from tax:

After the policy settlement, the lump sum received is exempt from tax.

Tax benefits:

Section 80D of the Income Tax Act provides that premiums paid for critical illness coverage are exempted from tax and can be deducted.

Lump-Sum pay-out:

Only one claim per person can be made on health insurance, including critical illness and hospitalization.

This lump sum can be used for hospitalization costs and other medical expenses for serious illnesses.

To ensure your complete recovery, you will continue to be seen at the hospital for regular check-ups, medical tests, and visits. These bills can be paid for in a lump-sum amount.