Critical Illness Disease Policy is an insurance product in which the insurer is contracted to typically make a lump sum cash payment if the policyholder is diagnosed with one of the specific illnesses on a predetermined list as part of an insurance policy.
Critical Illness Insurance Plans provides coverage against specific life-threatening diseases. A Critical Illness Plan pays a lump sum amount that can be used to cover high expenses. The good thing is that this lump sum payout is in addition to any Mediclaim or Health Insurance policy that you may already have. The policy may also payout regular income and the payout may also be on the policyholder undergoing a surgical procedure, for example, having a heart bypass operation.
The policy may require the policyholder to survive a minimum number of days (the survival period) from when the illness was first diagnosed. The survival period used varies from company to company, however, 15 days is the most typical survival period used. In the Indian market, survival periods are set between 15 – 90 days.
Critical Illness cover was originally sold with the intention of providing financial protection to individuals following the diagnosis or treatment of an illness deemed critical.
The finances received could be used to:
• Pay for the costs of care and treatment;
• Replace any lost income due to a decreasing ability to earn, or even
Fund for a change in lifestyle.
Health problems, in most cases, strike unexpectedly, resulting in a sudden financial burden for the family. In such cases, the family is not only worried about meeting the cost of treatment but also struggles with the loss of income they go through due to you being unwell. This most of the times, leads the family, to dip into their savings kitty built for child’s education or one’s own retirement. Your loved ones let go of their dreams to overcome financial exigencies health problems create.
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Esta historia es de la edición August 2019 de Investors India.
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