What is a Critical Illness Insurance Cover

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What is a Critical Illness Insurance Cover

What is a Critical Illness Insurance Cover

7 Minute |

What is a Critical Illness Insurance Cover

What is a Critical Illness Insurance Cover?

Critical Illness Insurance cover; the basics:-

To put into simple terms, critical illness insurance is the arrangement that will provide a certain degree of financial security in case you become gravely ill. This policy pays you a predefined sum if you suffer from a critical illness and get diagnosed regarding the same. What’s more, this sum is completely tax-free.

Generally, life insurance and critical insurance cover are available in combinations. But the only catch is, in an emergency situation, you have the option to claim only one. When you opt for a critical insurance policy, you can decide its tenure. You have to pay premiums throughout the tenure and once the tenure ends the protection provided by the policy also ceases to exist.

Who should opt for the critical illness policy?

The reasons for opting for a critical illness insurance cover are different for different age groups. The similarity between the different plans is that they all are compelling and need to be addressed as soon as possible.

A single person may have his loan payment facilitated in case he becomes critically ill and often, it is that loan application demand cover which the critical insurance policy can provide. A family head can ensure that his children’s education fees are paid and that his family is looked after properly even if he falls critically ill. The advantage of buying this insurance is that it also makes up to the extra cost of change in lifestyle in the cases of critically ill patients.

Should I buy it?

One thing that you need to assess before purchasing this policy is the benefit of the pay-out and the impact of premium payment on your financial calculations. A critical illness insurance premium calculator can be used to calculate the second part, as for the first part, you need to carefully assess and ensure that the pros outweigh the cons completely.

The policy is particularly useful when your whole family depends largely on your monthly salary. In other scenarios, if you do not have any financial dependents and do not share any financial commitments, then it is best that you do not enrol yourself for this policy and may go for other insurance products.

What is the amount of cover that I need to opt for?

Some insurance plans offers partial payment of sum assured depending on the seriousness of your illness. The basis of arriving at the answer to how much cover you need is to determine what would be the actual monetary losses that would be incurred if you stopped working due to illness. This amount has to sum up with other factors such as financial commitments, loan repayments, children’s expenses, mortgage, etc. This amount is unique for each, and therefore, the answer to this question needs to be answered on an individual basis.

Which illnesses does the critical illness insurance policy cover?

Certain types of cancer, heart strokes and attacks, Parkinson’s disease, deafness, meningitis, head injury, are some of the classifications of critical illness and are included in the policy.

One must note that the illnesses covered in a policy entirely depend on the insurance company and this cover changes from company to company, and one must read the documents carefully to get a gist of it.

What else is required?

You will have to submit your medical history and would be required to give details about your current financial health to the insurance company. This will allow you to get a critical insurance quote. This information allows the insurance company to determine the risks associated upon covering you, and the price is then given to you accordingly. One must be honest and must provide accurate information to avoid any future problems with the insurance company.

It is always advised to stay protected, and critical illness insurance does just that seamlessly. It ensures that the financial flow does not become intermittent even in cases of critical illness. You must buy it to safeguard yourself and your family from potential threats that entail critical illness.


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