While health insurance is essential for covering hospitalization expenses, critical illness insurance provides a lump sum benefit that can help you financially cope with a life-threatening illness.

Additional insurance is critical illness insurance that is useful for people with a pre-existing health condition or a higher risk of developing a disease. It’s also a good idea to consider critical illness coverage if you have a family history of certain diseases.

Cost

Health insurance costs vary depending on the type of plan you have. For example, PPOs and HMOs have different co-pays and deductibles, and some health plans may offer more comprehensive coverage.

Many people purchase health insurance through their employers, which can save them money. However, many health plans don’t cover all the expenses associated with life-threatening diseases.

In addition to health insurance, critical illness policies are a valuable way to protect yourself against unexpected medical emergencies and costly treatments. These benefits pay a lump sum upon diagnosing a covered critical illness.

Often, illnesses like cancer or heart disease can result in significant treatment costs and long-term care. These costs can take a toll on your savings and income and can be a substantial financial stressor.

Coverage

Health insurance pays out a portion of the cost of medical services when you become sick or injured. It is the same principle as a car or home insurance – you or your employer choose a plan and pay a premium in return for protection against medical expenses.

Critical illness insurance is similar in that it offers a lump sum cash benefit when you’re diagnosed with a severe covered illness, such as heart disease, cancer, or stroke. These benefits can help with day-to-day expenses such as travel to and from treatment, child care, and home healthcare needs.

Critical illness plans are a popular alternative to traditional health insurance because they don’t cost much, especially if purchased through an employer. They’re also a good way for employees to protect themselves from high out-of-pocket costs that can arise when enrolled in a low-deductible health insurance plan.

Period

The period that health insurance and critical illness insurance policies are in effect can vary greatly. While many health insurance plans are only for a year, necessary illness insurance can last for a lifetime.

Critical illness insurance, also called CI or severe illness cover, can pay you a lump sum of money when you’re diagnosed with a covered critical illness, such as cancer, heart attack, stroke, or organ transplant.

These benefits can help you manage the financial burden of a severe illness, such as hospital expenses and lost income. They can also cover everyday expenses such as mortgage payments, groceries, and bills while undergoing treatment or recovering from surgery or a hospital stay.

However, these types of policies can be expensive and not a replacement for primary medical coverage. Instead, they’re often purchased to provide additional peace of mind. The decision to get critical illness insurance or to keep your current health insurance depends on your risk tolerance, family situation, and financial profile.

Claim process

Health insurance covers the costs of medical treatments, like doctor’s visits, emergency rooms, surgery, and prescription drugs. It pays a monthly or annual premium and offers a lump-sum benefit amount if you suffer a critical illness.

Several essential questions exist if you decide to buy a critical illness insurance policy. These include the types of illnesses covered, how much is paid out, and the period in which benefits are provided.

When you choose a critical illness insurance plan, consider the cost and how it affects your financial goals. For example, it’s often more expensive than other types of coverage, and your premiums tend to increase as you age.

Also, critical illness insurance excludes a lot of common health conditions, and you may have to undergo specific procedures before it pays out. For example, some policies require you to be diagnosed with a particular type of cancer or to be disabled before it will pay out.