Even though Canada offers its citizens some of the best medical care globally when a critical illness strikes your income may be disrupted and you may not be able to cover all the non-healthcare costs that your diagnosis may require.
Our human nature always leads us to believe that serious illness will happen to others and not us. However, the reality of the matter is that %20 of men and %25 of women will suffer from a heart attack or some form of cancer in their life before they retire.
Critical illness insurance covers a whole range of illnesses. These include cancers, heart attacks, strokes, major organ failure, Multiple Sclerosis and increasingly, other neurological ailments and according to statistics, 312,000 Canadians are faced with critical illnesses annually.
Deciding factors on what type of cover to get
How much critical insurance you need will depend on how much income you stand to lose if you are too sick to work. Other factors that you must consider are what your current expenses are if you are not able to bring an income home anymore. This includes:
- Loans, credit cards, and debts, including a mortgage
- Utilities and groceries
- Other living expenses like your children’s education
The additional expenses that you may incur in the event of critical illness may include:
- Some healthcare costs
- Travel expenses for treatments
- Child care expenses during your illness and recovery
- Professional nursing services
The most common way to work out how much insurance to buy is to calculate your annual income and then multiply it by four. That figure is a safe estimate that ensures that you have four years of bills covered. Other considerations that need to be taken are the availability of other liquid assets that can be converted to cash if needed.
Make sure that you cover terminal illness, total disability, and severity cover for some illnesses. Other things to consider are the flexibility to extend or shorten the policy and waiver of premium if you are unable to work.
If you cannot afford to pay much, even a small critical illness policy is better than no policy at all and it’s best to get one that you can afford than default on payments.
Critical insurance policies usually have a schedule written out and the premiums will increase every time you fall into a new age bracket. After the age of 65, the benefits are usually cut in half and most of these policies expire when you are over 70.
Which illnesses are covered?
Different insurance providers offer various products however, most of them have a basic product that covers 3-4 most common illnesses and then other lines of offerings that cover a more comprehensive list of illnesses. The basic critical illness products commonly cover the following: Cancer, Heart Attack, and Stroke. After all, the chances of Canadians becoming affected by these illnesses are higher than one may think. According to statistics,1 in every 2 Canadian* is expected to be diagnosed with cancer, 1 in every 5 Canadians* dies from a heart attack, and more than 50,000 cases of stroke* are reported every year.
The more comprehensive policies cover the following, depending on the carrier:
Aortic Surgery Aplastic Anemia
Bacterial Meningitis Benign Brain Tumour
Blindness Cancer (Life-Threatening)
Coma Coronary Artery Bypass Surgery
Deafness Dementia, including Alzheimer’s Disease
Heart Attack Heart Valve Replacement or Repair
Kidney Failure Loss of Independent Existence
Loss of Limbs Loss of Speech
Major Organ Failure on Waiting List Major Organ Transplant
Motor Neuron Disease Multiple Sclerosis
Occupational HIV InfectionParalysis
Parkinson’s Disease and Specified Atypical Parkinsonian Disorders
Severe Burns Stroke
Medical requirements for getting a critical illness policy and how it pays out
If you have self-inflicted injuries or participate in a crime or fight in a war, you will not be eligible for payment under critical illness insurance. Even though disability insurance and critical illness insurance both cover critical illnesses, it is possible that you may not qualify for benefits under the disability insurance and be paid out by critical illness insurance.
If you do become ill the policy has a survival period. The survival period of a critical illness is usually the length of time needed that the person diagnosed with an illness survives before the critical insurance is paid out. It usually varies among the different insurers but can be anything from 14 days to a month.
Even though you probably have disability insurance and life insurance, these will only address your replacement income but not all the other unexpected costs of illness. You may not want to surrender a life insurance policy whereas critical insurance pays out a lump sum.
Receive your critical illness benefits
You can choose to receive part of your benefit or the whole amount if you become ill. If you choose to receive 25% of your benefit for a certain illness, if you are diagnosed with an illness in the same category again you will only qualify for the remaining 75% payment. However, if you are diagnosed with another illness from another category later, you will receive the full benefit.
Once you receive your lump-sum payout after the survival period there is no limit on how you can spend it. However, once you receive the payout you are not liable to get any more money and the policy will basically lapse.
Consult an Expert!
Our expert insurance brokers can be an important asset to you in the decision-making process. They will guide you through your individual needs through understanding your unique situation: your income, dependents, debt and other commitments; so that they can determine how much you need to be insured for and what type of cover is best for you.
The online quoting system option is also available through our app “GetCovered”. Now you are able to get an instant critical illness quote and compare rates on our website. Get covered also has the option for our customers who wants to know how much critical illness insurance coverage they need.