Critical Illness Insurance Definition
What is critical illness insurance? Critical illness insurance or critical illness is a health insurance product in which the insurer (the insurance company) is contracted to make a lump sum, tax free payment in the insured (the one who’s life is protected a critical illness) is diagnosed with one of a list of insured illnesses.
In Canada a critical illness policy is often designed to pay out 30 days after diagnosis of a critical illness. The payment is made lump sum and tax free. That means the total amount of insurance the policy is for (like $100,000 or $250,000) is paid out to the policyholder as a single cheque. The benefit or claim of a critical illness insurance policy is deemed a health benefit by the Canada Revenue Agency (CRA) and is therefore a tax free payment.
Most common insured illnesses under a critical illness policy
The following list is the most common list of all critical illness coveredby insurance companies. Some companies may have a few more or less illness covered in their list of included conditions.
Alzheimer’s Disease
Aortic Surgery
Aplastic Anaemia
Bacterial Meningitis
Benign Brain Tumour
Blindness
Coma
Coronary Artery Bypass Surgery
Deafness
Heart Attack
Heart Valve Replacement
Kidney Failure
Life-Threatening Cancer
Loss of Limbs
Loss of Speech
Major Organ Transplant on Waiting List
Major Organ Transplant
Motor Neuron Disease
Multiple Sclerosis
Occupational HIV Infection
Paralysis
Parkinson’s Disease
Severe Burns
Stroke
Although this list might not cover every possible illnessyou might undergo, it covers the most prevalent ailment. 89% of all critical illness insurance claims come from the four pointed out illnesses; bypass surgery, heart attack, life-threatening cancer, and stroke.
Minor included illnesses and partial payouts
There are several non-life threatening forms of cancer or heart conditions that will not pay out the full critical illness benefit. These condition (usually|commonly|generally) have a partial payout from the insurer. A partial payout is (usually|commonly|often) 10% of the total critical illness benefit. Some insurance companies will lower your total critical illness benefit when claiming a partial payout, and others will keep you benefit whole.
Here is an outline of the most frequent partial payout covered ailments:
Early Prostate Cancer: Stage T1a and T1b prostate cancer
Ductal Breast Cancer: defined as �the presence of ductal carcinoma in situ of the breast as confirmed by a biopsy�
Superficial Malignant Melanoma: a malignant melanoma on the skin that hasn’t penetrated the fist layer of skin.
Coronary Angioplasty: going through the intervention procedure to unblock or widen a coronary artery that produces blood to the heart.
Standardized definitions of illnesses in Canada
Canadian insurance companies had to define �what is critical illness insurance� and what comprises a diagnosis for a critical illness that justifies a payout. In 2005, at the World Critical Illness Conference, all Canadian insurers embraced the internationally agreed upon standardized definitions for a covered critical illness. This indicates that the insurance companies and critical illness insurance policies in Canada represent the standard Canadian and international medical associations’ standard definitions of what comprises standard and acknowledged testing methods for illnesses to verify a diagnosis.
Usually a diagnosis of an illness has to be executed by a professional in the field, like a cardiologist or oncologist. Once a diagnosis of a critical illness is made by a Canadian doctor, that diagnosis will be instantly acknowledged by the insurance company, which is using the standard definitions of critical illnesses as the medical profession.
The need for critical illness insurance
Lots of people are concerned with protecting themselves and their loved ones in case of a serious illness or injury that could certainly affect their financial plan and savings. Here are some simple statistics of the risk each Canadian has of getting a critical illness:
One in three will develop life threatening cancer in their lifetime
Half of all heart attack victims is under age 65
31% of all deaths in Canada are cardiac related
80% of people will survive their first heart attack
There are 50,000 new stroke victims in Canada each year, and 75% of them will be left with a disability
We can not deny statistically that the risks are real. The real question is do you believe it’s possible to happen to you, and if so, {would you want financial protection? Here are some methods you could utilize the benefits of a critical illness insurance policy:
Pay for the cost of out of Canada health care
Pay off debts, like a mortgage and line of credit
Pay for additional health care services and recovery assistance, like in home care
Replace lost income from time off work
Fund a lifestyle change like renovations to accommodate a disability
What is Critical Illness Insurance � learn more from Life Guard Insurance
If you are interested in securing your finances and way of life from a critical illness then critical illness insurance may be perfect for you. Feel free to contact Life Guard Insurance to answer the question what is critical illness insurance for your unique financial {situation|condition|circumstance).
