Ashish wished his friend profusely with a packet of sweets,“Happy Birthday Akshay! You are 50 years old now…what words of advice can you share with younger friends like me?”
Akshay said,“Thank you so much Ashish! Yes, now you respect my grey hair…ok, since you asked, make sure you have adequate health cover! I have good health insurance…but now I’ve decided to take a Critical Illness Plan as well. You too should.”
Ashish interjected, “Don’t tell me you have health problems! Can you have these sweets or should I get you savories instead?”
“Nothing like that my friend. Wow, they are delicious, thanks! Well, acute illness can strike anyone at any time. It could mean loss of income, total or partial disability and change in lifestyle too. The financial burden could be far more than what a regular mediclaim policy would cover. Buying a critical illness plan as a supplement to your health insurance portfolio is the best solution, because it pays a lump sum on diagnosis of serious ailments listed in the policy document.
This lump sum can be used to pay for expensive treatments or recuperation aids, make up for loss of income due to fall in the ability to earn or pay off debts.”
“But tell me Akshay, how do I buy a Critical Insurance Plan?”
First, let us consider what you should be buying.
What to Buy
Critical illness covers are fixed benefit plans. One gets the full sum insured irrespective of whether one is hospitalized or not or what the treatment expenses are. Most plans have a survival period clause wherein the insured must survive for at least 30 days after he or she is diagnosed with any critical illness to file the claim. The number of critical illnesses covered also varies, ranging from 12 to 35 illnesses. The built-in coverage also differs from policy to policy.
Here are some points you should consider while shopping for a critical illness policy.
Illnesses covered: Evaluate the list of critical illnesses covered. If you have a family history of cardiac ailment or any other major illness, make sure these are covered.
Adequate Sum Assured: Consider the average cost of treating major illnesses while evaluating the cover size. Do not forget to take into account inflation. Factors you should consider include treatments costs, recurring costs and future financial liabilities in case of income loss.
Age and medical history are also important while deciding the appropriate sum insured. Older people should buy larger covers. They are more vulnerable to these illnesses and the indemnity health plans available for them are expensive and have low sum insured.
Also take into account any existing policies you might have, like Mediclaim or personal accident and disability insurance policy.
Standalone or Rider?
While a critical illness plan can be bought as a standalone policy, critical illness riders are normally clubbed with life or health insurance plans. While the policy terms and conditions under both the options are comparable, the choice between a standalone policy and a rider depends on our need.
Ashish was almost speechless! “My, that’s a comprehensive check-list my friend!”
“Of course, Ashish,” smiled Akshay, as he popped another sweet into his mouth, “After all, this is a fact of life-threatening critical illness care and cover. Think carefully, take your insurance advisor’s inputs and decide on your optimum plan.”