Who Should Consider Critical Illness Insurance?

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Critical illness insurance provides you protection against 30+ major illnesses. As lifestyle diseases grow in India, investing in this insurance is essential to safeguard your income as well as savings.


It pays a lump sum amount which you can utilise for daily expenses, food costs or medical treatments. But for whom is the insurance right? Let’s find out.


Who Should Buy Critical Illness Insurance in India?


1. People With a Family History of Disease


Not all critical illnesses are lifestyle-based. Genetics play a critical role in these situations. For example, Type 2 diabetes, although a lifestyle disease, has a genetic component. So, if any of your family members has a disease, the chances are higher for you. In this scenario, getting critical illness insurance saves you from financial ruin while taking care of your health.


2. Older Age


If you are above 40 years of age, the chances of developing a critical illness increase. In fact, according to a PubMed study, ICU wards account for 60% of older adults. Why take such a risk with your health? Invest in critical illness insurance while you are young, so that when it matters, you will be covered.


3. You are the Sole Breadwinner


Critical illnesses, such as heart disease, often do not show symptoms until it is too late. If you are the sole earner in your family, then securing your health is important. Did you know that a single angioplasty can cost between Rs. 75,000 and Rs. 2,00,000 (approx.), which can drain your entire savings. So, investing in critical illness insurance remains a smart move in these scenarios.


What is the Difference Between Critical Illness Insurance and Standard Health Insurance?


When looking for the answer to who should choose critical illness insurance, knowing the difference between a standard health insurance plan and a critical illness plan is necessary:




































Aspect



Standard Health Insurance



Critical Illness Insurance



Type of Payout



Payout is indemnity-based



You get a fixed payout



Scope of Coverage



Covers injuries, accidents, and illnesses



Dedicated to covering only the critical illnesses mentioned in their list



Fund Usage



You can only use it for hospital bills and medical expenses



Unrestricted usage of funds; you can use it for income replacement, living costs, etc



Claim Frequency



Multiple claims allowed



Usually, only 1 claim per policy



Waiting Period



Multiple waiting periods are applicable



Initial waiting period and survival period



How to Choose Critical Illness Insurance?



  1. Sum Insured Amount: Choose a plan with a sum insured amount 5-10 times your income. This will ensure that both your income and treatment costs will be covered.



  1. Entry Age: Check the age of entry for the policy; insurers generally set the entry age at 18 years and the exit age at 65 years.



  1. Claim Settlement Ratio: Choose a plan from a reputed insurer. Check your insurer’s claim settlement ratio (CSR) and ensure it is above 90.


Final Thoughts


If you are the sole breadwinner of your family, have a family history of medical illness and are over 40, you must invest in critical illness insurance. It saves in times of need and acts as a beacon of hope.