Critical Illness Insurance is a living benefits policy that pays a lump-sum amount in the event of a life-threatening (critical) sickness.
Meaning, if in any event while your policy is in effect, you get inflicted with a serious illness that’s covered by your policy and survives the waiting period (usually 30 days), you will receive a lump-sum payment for the amount of coverage stated in your critical illness policy.
Everyone gets sick and while most of the times the majority of us get inflicted with less serious illnesses like colds and flu, stomach ache, fever, and minor respiratory infections, some people may acquire more serious illnesses like cancer, stroke, heart attack, or any other critical illnesses conditions during their lifetime.
Of course, none of us would like to think that we will ever get inflicted by such serious illnesses but unfortunately, in Canada, statistics reveal that one in every two Canadians will develop cancer at some point in their lifetime and in every one hundred people who had a heart attack, 75 people will carry some sort of disability throughout their lifetime.
These facts alone will get us thinking about the importance of a critical illness insurance protection, not to mention the fact that Manitoba has the highest case count of multiple sclerosis in Canada and Canada having the highest case of MS in the world with an estimated count of 77,000 Canadians currently living with this condition.
Now, this critical illness insurance article does not intend to scare you with these facts, because even when a person gets diagnosed with a critical illness, chances are, that person may still live a very long life after recovering from the illness and just because a person is diagnosed with a serious illness, it doesn’t mean that it’s the end of the world, medical advancement has changed all that and that’s the good news!
The bad news is, a lot of people who were diagnosed with a critical illness condition got caught financially unprepared which makes it more challenging for them to get back on track after surviving a serious medical condition.
If an individual gets diagnosed with a critical illness, the person gets affected not only physically and emotionally but also financially. Chances are, you won’t be able to continue working at your job, business or profession while recovering from a serious illness.
Should that happen, your focus shouldn’t be as to when the next paycheck is coming but in getting well and in full recovery. Worrying about money when you’re ill causes too much of an emotional drain which may not be good to your well being when you’re trying to recover from an illness.
In the event of a serious illness, a critical illness insurance can:
- help you pay your monthly ongoing living expenses like household bills and debt servicing.
- replace you and your spouse’s income so you don’t have to worry about lost or reduced income while recovering from an illness.
- pay off your consumer debts in full so you don’t have to worry about them.
- pay off medical expenses that are not covered by provincial and your company group health plans.
- help your family pay off additional medical or household assistance that your family may require.
- pay off travel expenses, should you opt for out of the country medical treatment.
Is Critical Illness Insurance Worth It?
I have a friend who once said, “If we know exactly what’s happening inside our bodies or we know exactly when we’re going to die, then we know which kind of insurance will give us the highest return on investment.” Though said jokingly, this line couldn’t be closer than the truth except that we can never know exactly what’s happening inside our bodies.
Fact is, we can never out-pay our insurance premiums. You will always get the higher amount of benefits than what you’re going to contribute in premiums plus the fact that the peace of mind of having the necessary protection for your family is simply priceless.
If you’re concerned about losing the premiums you’ve contributed in the event that you did not have any form of critical illness condition during the term of your coverage, most critical illness insurance policies come with return of premium (ROP) options.
This means that if no serious condition ever occurred during the term of your critical illness insurance policy or should you pass away without getting critically ill, all premiums you ever contributed will be returned either to you or your loved ones whichever the case may be.
Having said that, we can always structure your critical illness insurance policy like long-term forced savings account with a twist; think of it like contributing a certain amount in locked-in savings for the term of your policy that you can withdraw after your policy contract is due but all the while, you are protected with a critical illness insurance should some sort of illness that is covered by your policy occurs.
If you were to ask any person who has been inflicted with any type of critical illness condition, they will tell you that a critical illness insurance protection is simply worth it. Getting seriously ill prevents you from working for a living and for most people, their income stops abruptly if they can’t work.
The purpose of a critical illness insurance policy is to provide you with the peace of mind in knowing that you’re going to have the money should an illness prevents you from doing what you do to earn a living for yourself and family.