23 AUG 2016
Things to keep in mind while taking the critical illness policy
You may have heard a lot about critical illness insurance. You are convinced that buying critical illness insurance is beneficial for your financial security. You are now scouting for the best critical illness insurance plan in the market. We tell you 6 things that you need to keep in mind when buying a critical illness insurance policy.
Every critical illness plan will have a list of illnesses that they cover. Go through this list carefully and do research if these diseases are prevalent in India. There is no point in buying a policy if it does not cover illnesses prevalent in India. There are some policies that cover only Cancer of various forms.
In a critical illness insurance, unlike a mediclaim policy, no hospitalization is required as a payout is made on the diagnosis of the critical illness. Make sure this fact is clearly mentioned in the brochure. You don't want to be hassled at the time of claim regarding the conditions of the payout.
Number of claims
If it is a critical illness insurance plan, it will give you a lump sum payment on diagnosis of the critical illness. Does the policy give you a facility of claiming multiple times within the policy period. Most critical illness policies get terminated when you make a claim and the same is settled? Which means that the policy does not continue and in the event of you suffering from another critical illness, you are left without any financial protection. For instance, you suffer from a cardiac condition and are required to undergo a procedure for removing the blockage in your arteries using CABG(Coronary Artery Bypass Grafting). You make a claim and receive the payout, following which the policy gets terminated. Let's say, after a year or so, you suffer from severe burn injuries which will require you to take considerable time off from work. This time, since your poly terminated when you made the claim one year back, you are left with no financial support to meet your EMI's, utility bills etc. Very few policies like Edelweiss Tokio Life – CritiCare+ offer you an option to claim multiple times.
Go through the exclusions list. These are events under which you do not qualify for a claim if a critical illness occurs. For instance, if you indulge in horse-riding as a hobby and the policy does not cover injuries occurring due to the same, you will not be entitled to a claim if your critical illness is related to the same. Make sure you do not book a policy in such cases.
Make complete disclosures about your health. If you are a smoker or consume tobacco in any other form, make sure to mention it explicitly. If this fact is discovered at the time of submission of claim, your claim stands the risk of being repudiated.
Premiums paid under critical illness plans are eligible for tax rebates under Section 80D of the Income Tax Act, 1961. Payouts made by the life insurance company to you are tax exempted under Section 10D of the same Act. Make sure this fact is clearly mentioned in the policy brochure.
Make sure you look for the above before taking a decision to buy a critical illness insurance plan.
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