You’ve probably have heard the term “critical illness insurance” lately. It’s a trending topic, and for a very good reason.
The good news is Canadians are living longer than ever before and we continue to find ways to cure or extend the life of people with a serious disease.
The downside of longevity is illness.
Having to take time off work to recover from being sick or having your partner lose work time to take care of ill family members means one thing for hardworking families: financial devastation.
Today we’ve got about 85 years to enjoy on the planet. One major illness, like cancer, can mean several of those years are spent scrimping by, paying off debt from having your income stream or retirment planning interrupted.
Living longer is great, but having a long life counts the most when you can actually enjoy it.
There is a solution!
Critical illness insurance bridges the gap between life insurance and disability insurance by providing cash for what ever is needed to help cope with a health crisis.
What is Critical Illness Insurance?
Unlike life insurance where you pass away to have the benefit go to your beneficiaries – critical illness insurance pays you a lump sum tax free benefit that you can use in any way you wish if you are diagnosed with a covered condition.
Depending on the policy you choose, this could be cancer, heart attack, stroke only – which make up nearly 80% of all claims or include other conditions as well.
Is Critical Illness Insurance Expensive?
The expense of critical illness insurance depends entirely on your perspective. Getting sick is expensive. Medication is expensive. Time off work is expensive. Experimental and out-of-province treatments are expensive. Caregivers are expensive.
Critical illness insurance has a cost too, but it is less than the cost of getting sick with a prolonged illness. Most families find the premiums very manageable.
Some critical illness insurance policies come with a return of premium rider. That means if you pass away or a significant period of time lapses before you use the policy, your premiums are returned to you.
What Factors Affect the Cost of Critical Illness Insurance in Canada?
Like all life and health insurance products, the price (premium) of the policy is tied to your age and health.
Premiums are lower for younger, healthier individuals. If you are already suffering from a serious disease, you are a senior, or your general health is poor, you will pay a higher premium, receive a rated offer, have certain illnesses excluded or be advised to apply for a simplified or guaranteed issue no medical critical illness insurance policy.
Those non-traditional policies are still affordable, but are more expensive than fully underwritten policies.
The riders you add to your policy also affect the price. Riders are optional add-ons that enhance your policy. These can include a return of premium rider that refunds you premiums after a certain number of years if a benefit has not been paid or a child rider.
Critical Illness Insurance Comparison Canada
There are many different types of critical illness insurance policies in Canada. Some cover just three conditions, but others cover 30. With so much variety, you need to make sure you get the policy that is right for you. To do that, speak with a broker.
A life insurance broker, unlike an agent, can sell the products of any life insurance company in Canada. An agent, such as an advisor that works directly for one life insurance carrier can only sell the products of the one company they represent.
With a broker, you have more options.
A broker will ask you questions about your health and family history to help indentify the most suitable carrier to work with.
To learn more about it, contact us today.