Critical health condition treatment can be extremely expensive, bringing some to bankruptcy. Therefore, critical illness insurance was created to help those individuals and families during a serious health disaster.
What it Is
Critical illness insurance covers three common health conditions including heart attack, stroke and cancer. This policy, depending on what is written, could also insure conditions resulting from paralysis, kidney failure and major organ transplants. This supplemental insurance is something to consider because majority of people filing for bankruptcy have health insurance.
How it Works
The insurer must pay a lump sum to the insured if he or she is diagnosed with a major illness listed in the policy. The plan pays a tax-free lump sum after the initial diagnosis is made. The insured must survive a certain number of days following diagnosis before receiving payment, often varying from 14 to 30 days.
Different Types of Coverage
Policies vary depending upon how much they pay out. Many offer a lump sum payment between $5,000 and $50,000. The higher the premium, the more is paid. Plans are available that offer portable coverage as well as coverage for spouses.
Benefits of Coverage
Major benefits include relieving burdensome costs to fight serious illness. It grants peace of mind to those carrying the policy if they financially lose everything. These benefits are paid in lump sum, giving the insured the chance to pay health providers as well as normal living expenses.