Due to the advancement in today’s medical technology, we are more likely to survive a critical illness. This is why critical illness insurance is important for everyone. A critical illness plan pays clients a benefit in the event they are diagnosed with a critical illness, such as cancer, heart attack and stroke.
Some companies also cover other conditions that may include: renal failure, paralysis, coma, organ transplant, Alzheimer’s disease, just to name a few. Critical illness coverage is a “living benefit” and it is meant to protect the clien's savings and provide them with priceless peace of mind.
What is Critical Illness Insurance?
A critical illness plan is different than a specific disease plan. A critical illness plan covers multiple conditions; specific disease plans cover only one disease, such as cancer or heart attack.
Some critical illness plans also include the added bonus of life insurance and will pay a benefit when diagnosed with a critical illness, or upon death. There are many different plans available through several insurance companies.
History of Critical Illness Insurance
Critical illness insurance was created in 1983 by Dr. Marius Barnard, a cardiac surgeon, in South Africa. Dr. Barnard witnessed the financial hardship that his patients suffered when they were treated with a critical illness. He saw the need for an insurance plan to pay a living benefit to offset the patient’s lost income during recovery. The first Critical illness policy was launched in South Africa. The United Kingdom, Canada, Europe, Australia, Japan and East Asia soon followed.
Why Do Your Clients Need Critical Illness Coverage?
Even if you have the best health plan, it will not cover 100% of your medical expenses in the event you are diagnosed with a critical illness. Nearly two thirds of bankruptcies are the direct result of medical expenses and 78% of those filing already had health insurance!1 As stated earlier, due to the advancement in medical technology, we are more likely to survive a critical illness.
Critical illness insurance is one great example of the increasing movement of employers toward voluntary benefits. Voluntary benefits are insurance products that employees may choose to purchase through their companies at rates that are lower than they could get on their own. A few examples of voluntary benefits are dental, vision, life (mostly term), accidental death and disability, disability (short and long-term), supplemental health (i.e.- specified disease, critical illness, hospital only, etc.) and cancer insurance. Many employers offer voluntary benefits because they allow companies to provide a more robust benefits package at no cost to them.
Client Peace of Mind
The benefit an insured receives from this insurance can be used to pay their monthly out-of-pocket expenses, such as the mortgage payment, deductible and coinsurance on your health plan, auto payment, etc. Having a critical illness plan will help protect their savings account in the event they are diagnosed with a critical illness. Because of this the client does not have to worry about depleting their savings account or wondering where the money is coming from to pay the bills. This allows insureds to be able to focus on their treatments and recovery. Critical illness insurance provides peace of mind.
This is why the product is a nice fit as a supplement to health savings accounts and provides safeguards as we enter the era of health care reform. Critical illness insurance is the product of the future. These plans are affordable, starting as low as $25 a month. Everyone can benefit from this insurance and because it does not underwrite like other products it is perfect for tobacco users.
