How much coverage do you need?
The first thing to consider is the amount of money you need to keep your family going if you are hit with a critical illness. This includes all monthly bills, groceries and expenses. Once these have been added up, then you should think about any extra expenses such as private treatment or alterations to your home.
If you have other insurance policies that cover other illnesses, it is advisable to take free cover from them rather than paying for additional insurance. For example many income protection policies will give free critical illness cover. It might be better value for money for you to find out about this before deciding whether or not to buy extra critical illness cover.
Another point to consider is the amount of time that you would need to keep receiving payments from a policy if diagnosed with a serious illness. Life expectancy after diagnosis can often be longer than many people imagine meaning they may need payments for longer than originally expected.
What are the chances of getting it?
The most important thing to think about when buying critical illness insurance is your risk. Are you getting the right coverage for your situation?
- Family history: If you have a family member who has suffered from a critical illness, this could increase your chances of suffering from one as well.
- Job/Lifestyle: Certain occupations and lifestyles make some more likely to suffer from critical illnesses than others. For example, policemen, firemen and anyone who works with chemicals or toxic materials are at greater risk of suffering from certain cancers or other illnesses. Smokers are also at higher risk of developing cancer than the general population.
- Age: In general, men over 40 and women over 50 are more likely to develop cardiovascular disease—the most common critical illness—than any other age group.
What is your age and health condition?
When you apply for critical illness insurance, the insurer will ask you questions about your age, health condition and family history of illness. The answers you provide will affect the cost of your premiums. For instance, if you are older when you apply for coverage or if have a pre-existing condition (like diabetes), it may be more difficult to get an affordable premium. If you smoke or have other health risks like being overweight or having high cholesterol, these factors may also influence the premium rate.
If it’s been awhile since you last had an exam done by a physician, it might be a good idea to schedule one before meeting with an insurance representative. The doctor can identify any potential problems and provide more accurate information on your current health status before completing any required medical forms. It’s important to do this before starting the application process as it can help prevent any delays in processing applications and receiving approvals for coverage.
Do you want to get a stand-alone policy or add it to your life insurance policy?
Stand-alone critical illness insurance policies typically offer more coverage and greater flexibility than you would get with a rider.
If you already have life insurance, adding a critical illness rider will often be the most cost-effective option. You can buy stand-alone policies that protect against multiple illnesses, while riders may only cover one or two conditions. Most insurers will cap the amount of coverage you can add to your life insurance policy at $100,000 or less.
To make sure you’re getting the best deal for your needs, compare quotes for both stand-alone and bundled policies before making a decision.
Should you be covered for any other illnesses too?
For some, it can make sense to get coverage for other critical illnesses, such as cancer and stroke. Maybe you have a personal or family history of these types of illnesses. You might want to know that if the worst does happen, you’ll be able to serve your family’s needs without breaking the bank. The best way to protect yourself from worries about how you’ll pay for medical bills is through insurance.
The downside of getting coverage for more types of illnesses is that your premium will be higher. However, if your health status means that you have a low likelihood of developing one these diseases, it may make sense for you to cover them so that they’re not concerns in the future.
If you have a family, getting critical illness insurance will provide a financial safety net.
If you have a family, getting critical illness insurance will provide a financial safety net.
Think about it: most, if not all of your financial resources are tied up in supporting the lifestyle you want for your family. What would happen to them if an illness prevented you from working? How long could they survive on their own? Could they pay off the mortgage and other debts, or put kids through university or college? The peace of mind that comes with knowing that your loved ones would be financially secure in the event of illness is priceless—and critical illness insurance is designed to provide just that.