Critical Illness Life Insurance
Here's what you need to know.
Being stricken with a critical illness is something all of us hope to avoid. Unfortunately, serious illnesses do happen and cannot only disrupt our lives but can cause major financial hardship as well. If you are concerned about what could happen if you were diagnosed with a serious medical condition, you may want to learn about critical illness life insurance.
Here are a few important facts about some of the most critical illnesses that commonly afflict Americans:
- Heart disease: The National Center for Health Statistics reports that in 2010 roughly 27.1 million Americans were diagnosed with heart disease.
- Diabetes: The Centers for Disease Control and Prevention reports that over 23.6 million people in the U.S. have diabetes. Almost another 6 million are not even aware they have it.
- Breast cancer: The National Cancer Institute approximates that breast cancer may afflict as many as 226,870 women in a given year. Almost 81% of these women will become survivors.
What Is Critical Illness Life Insurance?
A critical illness can be defined as any illness which is “life threatening.” These insurance policies can provide coverage in the form of a lump sum payment in the event that you are diagnosed with a disease considered life threatening, such as cancer, heart disease, diabetes, stroke, kidney failure, or Alzheimer’s disease.
Critical life insurance is offered by many insurers to provide you with compensation after you have been diagnosed with a critical illness. The specific coverage is outlined in each individual policy. If you have a particular personal risk you are concerned about, you can contact an independent agent to ask whether critical illness insurance can provide financial protection specifically for that concern.
Reasons Why You May Need Critical Illness Life Insurance
If you are concerned about critical illness, it’s natural to be worried about your future and how you will be able to cope financially. You may also be anxious about the welfare of your family and how to continue to take care of them and pay for your medical expenses. Your life expectancy can also be a very important reason to buy this coverage.
Some of the things people need help with when they are diagnosed with a critical illness include:
- Coverage for lost earnings from illness
- Funds to cover mortgage or rent payments and living expenses
- Funds for medical treatment and prescriptions
- Supplemental family income
- Money for expenses if you operate your own business or partnership
- Financial assistance with future expenses such as your children’s tuition
Talk with an agent in the independent insurance network to find coverage for these items in a life insurance policy for critical illness.
Will You Qualify for Critical Illness Life Insurance?
Critical illness life insurance coverage depends on a variety of factors that can vary from one insurance company to another. Each illness may have particular restrictions, limitations, or requirements for coverage.
Here are a few things to know:
- If you already have been diagnosed with a critical illness such as cancer, you will not be able to purchase critical illness insurance. The time to purchase this coverage is when you are healthy but have a concern about the future.
- An insurance company may require detailed medical information, including a medical exam, before making a decision to accept your application for critical illness coverage.
- Your application may take from 14 days to 60 days or more to process. Depending on the specific policy, you may receive coverage fairly quickly or there may be a waiting period involved.
Because a critical illness can vary depending on the type of illness, treatment, and your current health circumstances, it can be a challenge to obtain this coverage. An independent agent can help you to navigate the process of finding the most appropriate plan for your needs and budget and completing the application.
What Will the Insurance Company Need to Know?
The insurance company will need an assortment of medical information to process your application. A representative may interview you by phone, require a medical exam from your personal care physician, or send a nurse practitioner to your home to take your vitals and complete a questionnaire.
Some of the key factors that the insurer may look at include:
- Your personal health history
- Your current health, including your weight and body mass index, your blood pressure, and cholesterol levels
- Results of a stress test
Each insurance company will have its own requirements for assessing your risk of contracting a severe illness. Essentially, insurance companies will take on a certain amount of risk, but will not cover a current or imminent critical illness when there is near certainty that you will file a claim.