Few things are more devasting
than the diagnosis of a critical illness. In addition to difficult health
issues, patients and their families may also struggle with associated financial
costs. Critical illness insurance can help.
What is critical illness
insurance?
Critical illness insurance is
not traditional health insurance. It does not cover routine or preventative
care, nor does it cover specific medical costs. It does not replace health
insurance. However, it can provide a good supplement to health insurance.
If you have critical illness
insurance and you experience a covered condition, you will receive a lump sum payment,
which you can spend as you see fit. You can use the money to cover medical
bills, but you can also use it for other purposes, such as:
·
Insurance
premiums, deductibles and copays
·
Childcare
or home health care
·
Gas or
transportation to and from appointments
·
Household
expenses such as food and electricity
As you might imagine, major
illnesses often result in additional expenses. You may be unable to work for a
considerable amount of time, and the loss of an income can be financially
devastating. Loved ones may also miss work to help with your care and
appointments. If your treatment team is not local, hotel rooms and
transportation costs can add up.
The combination of medical
costs and other expenses can be too much for families. According to a Kaiser
Family Foundation report, many Americans struggle to pay medical bills, and 11
percent say they’ve had to declare bankruptcy at least in part due to medical
bills.
Does critical illness cover
preexisting conditions? What does it cover?
Critical illness insurance
does not cover all illnesses. Coverage is limited to the conditions listed in
the policy, which will generally include certain types of cancer, stroke, heart
attack and organ transport. Other
conditions, including chronic, will be excluded.
You may be able to purchase a
critical illness insurance policy without undergoing a medical exam. However, preexisting
conditions may be excluded. These are conditions that that were diagnosed
and/or treated during the period before coverage. Under the Affordable Care
Act, health insurance plans must provide coverage for preexisting conditions,
but this rule does not apply to all types of insurance products, including
critical illness insurance.
In critical illness insurance
policies, preexisting conditions may be excluded from coverage for a set period
of time. For example, preexisting conditions might not be covered for the first
year that the policy is active, but coverage may be possible after that. When preexisting
conditions are excluded, secondary conditions resulting from preexisting
conditions may also be excluded.
Is critical illness insurance
right for you?
If you are thinking about
critical illness insurance, consider the pros and cons.
·
Pros: The premiums can be surprisingly low for the coverage
limits available. For example, the monthly premium can be as low as $20,
depending on the policy and the insured. The cash benefits start at around
$10,000 and go up significantly from there. A lump sum of cash can help ease
your financial stress so you can focus on recovery, if you’re ever diagnosed.
·
Cons: Critical illness insurance policies tend to offer very
restricted coverage, and if you have a preexisting condition, it will likely be
excluded from coverage.
The bottom line is that critical
illness insurance can provide invaluable financial support when you need it
most. Just be sure to read the policy carefully so you understand the
exclusions before you buy.
Have questions about critical
illness insurance? An InsuranceLineOne licensed insurance agent can help you. Request a
critical illness insurance quote here.
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