What Is Critical Illness Cover In Insurance?

Healthcare is always evolving, and advancements in technology plays a big role in that. From new treatments to better diagnostic tools, technology is changing the healthcare landscape. For example, just a few years ago the idea of using a 3D printer to create human tissue was nothing more than a figment of someone’s imagination, but now it is a reality.

The incidence of diseases, however, continues to rise. Today, ailments such as cancer, cardiac stroke, and paralysis have become common names in society. A survey found that 51% of people have one or more close personal relationships with people who have experienced critical illnesses such as heart attacks, strokes, blood clots, neurological complications, cancer acceleration or other sudden medical conditions in the past 2-3 years.

One of the biggest challenges when it comes to critical illness is the cost of associated treatments. Many people simply can't afford the high price tag that comes with it. For instance, in India, the average cost of treating any cardiovascular diseases is INR 2,47,822.

In spite of choosing the right health insurance plan for you, you may face a lack of adequate coverage should you be diagnosed with a critical illness.

How do you meet the costs of treating such critical illnesses?

That’s where a critical illness cover comes in. It offers you sufficient financial protection if you get diagnosed with a critical illness.

Let's first understand what a critical illness is.
 

What is a Critical Illness?

A critical illness is any serious illness, sickness, or disease that affects the general well-being of a person and needs medical treatment. It is potentially life-threatening or irreversible. Some critical illnesses include heart attack, coma, stroke, paralysis, organ transplants, primary pulmonary/arterial hypertension, cancer etc. Critical illnesses can strike anyone (especially if you have a family history of them), and the associated treatment can be costly and extensive.
 

What Happens After A Critical Illness Diagnosis?

Suffering from a critical illness can be financially draining. As medical technology advances, quality treatment has become increasingly expensive.
A critical illness diagnosis can be shocking for anyone, but it can be even more devastating if you are the sole breadwinner. You might have to quit your job since you need to take time off work for treatment. Losing your job and earning potential during treatment can put a huge financial strain on your family.

The disease won't just affect your paycheck, but it will also lead to increased expenses - consultations, treatments, tests, checkups, and lifestyle changes (such as wheelchairs, ramps, automatic beds, full-time nurses, etc.) - most of which are not covered by a basic health insurance policy.

Such situations call for a critical illness cover.
 

What Is Critical Illness Cover And What Does It Cover?

A critical illness cover provides you with financial protection if you suffer from one of the serious diseases listed in the policy document, such as cancer, heart attack etc. It can help you cover expenses like doctor consultation fees, and the cost of medicines and tests, among others. A critical illness cover takes care of ambulance expenses, room rent, and pre-and post-hospitalization expenses as well.

If you get diagnosed with a critical illness, the insurer will provide you with a lump sum that can be used to cover lifestyle changes and home modifications like incorporating a wheelchair into your home or installing oxygen tanks and can also serve as an income replacement for your family.
 

List Of Illnesses Covered Under The Critical Illness Cover

Most plans cover the following major conditions:

• Cancer (of specified severity based on the policy)
• Open heart replacement or repair of heart valves
• Major organ transplants, like liver and heart valves
• Permanent paralysis of the limbs
• Multiple Sclerosis with persisting symptoms
• First heart attack (of specific severity based on the policy)
• Open chest Coronary Artery Bypass Grafting (CABG)
• Kidney failure requiring regular dialysis
• Stroke resulting in permanent symptoms
• Bone marrow transplant

Let’s look at an example to see how the critical illness cover works -

What Are The Exclusions Of The Critical Illness Cover?

There are certain situations/treatments that are permanently excluded from coverage called exclusions. These are some of the exclusions of the critical illness cover -

1. Self-injury or suicide attempt-related illnesses.
2. Medical conditions caused by substance abuse, use of illegal drugs, narcotics (unless prescribed by a medical practitioner), intoxicants, alcohol, hallucinogens, etc.
3. A condition caused by ionising radiation or contamination by radioactivity from nuclear fuel.
4. Congenital external diseases, defects, or anomalies.
5. Medical conditions caused by partaking in naval, military or air force operations during peacetime.

Note: Please refer to your policy document for a detailed list of the exclusions applicable to your policy.

What Are The Conditions Associated With A Critical Illness Cover?

These are some of the conditions you need to know if you wish to invest in Critical Illness cover -

1. Number Of Illnesses Covered
A critical illness cover provides coverage for a list of illnesses. The number of illnesses covered varies across insurers.

2. Validity Of Coverage
A critical illness cover does not last a lifetime. The coverage ends at a certain age or year. Moreover, the policy will also terminate when a claim is made for a listed illness.

3. Survival Period
A majority of critical illness covers get triggered and pay the sum assured only if you get diagnosed and live through the illness for a specified amount of time, such as 30 days or 15 days. The claim amount is only aimed at covering lifestyle changes, healthcare costs, loss of income, and other costs that arise from the person's survival of the disease. Hence, if you pass away before the survival period, the critical illness cover won't pay the claim amount.

4. Waiting Periods
A waiting period is a period during which the insurer won’t provide coverage for listed illnesses. The idea of waiting periods is to prevent people with existing illnesses from buying the policy.

A critical illness cover has a waiting period that can last from 90 to 180 days, depending on the insurer. Please read your policy document carefully to find the list of waiting periods applicable to your policy.
 

Wrapping up!

A diagnosis of a critical illness will leave you saddled with extensive medical bills resulting from the required treatment. There is no better companion than a critical illness cover during such times of need. It will take care of your medical expenses should you be diagnosed with any of the critical illnesses covered under the plan. However, before purchasing the policy, make sure you are aware of its inclusions and exclusions.