What is an early critical illness plan?

The younger you are, the more indestructible you feel. However, with the advent of social media and other forms of communication, it seems that even the young are not free from critical illness. It might still come as surprise and mild shock when you hear someone in their thirties being struck down by cancer and the like but it can happen.

When it comes to insurance, it’s important to take a measured approach to decide if you would really need one. As with most insurance policies, critical illness plans really does have the insurance company rolling the dice and hoping that you remain healthy as long as possible. The healthier you are the likelihood of you claiming insurance is lower and that makes great business sense. Unlike savings plans or education plans, critical illness plans directly impact the individual.

Defining a critical illness

Critical illnesses have been defined differently throughout the years. Due to advances in medicine some forms of critical illness have dropped off the list while some have been in added. Typically, if an illness is likely to impact an individual in a manner that might be financially catastrophic, it will be classified as a critical illness. However, your mileage might vary, it would be prudent to study the illnesses that will be covered in your policy. As a good measure, these are the following conditions that would often be covered in a critical illness insurance policy –

  • Alzheimer’s disease
  • Blindness
  • Deafness
  • Kidney failure
  • A major organ transplant (e.g. heart, lung, liver, pancreas)
  • Multiple sclerosis
  • HIV/AIDS contracted by blood transfusion or during an operation
  • Parkinson’s disease
  • Paralysis of limb
  • Terminal illness
  • Heart attack
  • Cancer
  • Stroke

The above list is not exhaustive and most critically illness plans cover a minimum of thirty seven critical illnesses or upwards.

If you family members have been known to fall victim to any of the above illnesses, you might want to consider protecting yourself and ensuring that your dependants do not go into financial ruin while you take the time to battle the illness.

Better death than to live as a sick man

Depending on where you live in the world, the above refrain might ring true. Being struck by a critical illness would have dire impact on the financial situation. Imagine being struck by cancer and having to go for multiple rounds of chemotherapy.

In the best case scenario, you would have an employer who says “your job right now is to get better.” However, the reverse scenario might be more often the commonality. Those daily bills still need to get paid on top of the treatment expenses for your medical condition.

The payout from the critical illness plan helps cover the additional medical costs that a person may incur. Secondly, it helps the person deal with living expenses in the event that the person needs to take a break from working.

It is highly unlikely that you would be able to earn a consistent wage if most of your waking hours are spent commuting to a dialysis centre or recuperating from being nuked almost weekly with various rounds of radiation to fight off the cancer.

While the best of us feel invincible in our youth, it does not last forever. Putting off the purchase of a critical illness plan might get too expensive when bought too late. The same rule of thumb applies when it comes to the purchase of insurance here – you are a better bet if health is at the peak as opposed to older when the possibility of a claim increases dramatically. Not to mention, once diagnosed with critical illness, even the early stages critical illnesses, insurability becomes an issue.

Unlike a savings or investment plan, a critical illness plan is in place to help your immediate family cope with the effects of having to help manage your condition in the long run. Hopefully with proper care and medication, you’d be able to recover sufficiently to peak levels of health once again.

The alternative? A slow and arduous path to the end which might be taxing for everyone around you. Having an early payout will bring peace of mind to ensure that most needs are taken care of, allowing full mental focus on getting better.

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