Take a minute to imagine how it would impact your life, and the lives of loved ones, if you received a lump sum cash payment after being diagnosed with a serious illness. 

Critical illness insurance is a less talked about insurance benefit that provides you with a pre-determined payment amount if diagnosed with a major critical illness or medical condition. It is designed to offer financial support for medical conditions that you are expected to survive. Conditions commonly covered by critical illness insurance include cancer, heart attacks, strokes, bypass surgery, and loss of vision or hearing. Here is what makes this benefit different from almost all other illness-related benefits: it is paid out as long as you meet the medical criteria, even if you continue to work. Considering that more people are working and living longer with severe medical conditions, this is a prudent insurance policy to have. 

As the name implies, critical illness insurance promptly responds to a crucial need. The waiting period is short, and benefits are issued immediately if you survive up to 15 or 30 days after your diagnosis.  Once these tax-free funds hit your bank account, you can spend the money in whatever way works best for you. 

This is where critical illness insurance gets interesting. As we said above, you can spend this money any way you like. Some of the common ways policyholders have used their benefits were for medical expenses not covered by other insurance and to cover obligations like bills, rent, or mortgage payments. Others have put the money to use in creative ways that had a real impact on their daily activities and quality of life. Below is a list of ways you can use critical illness benefits.

• Personalized medical care
• Ergonomic chairs and beds to increase comfort when resting
• Upgraded or specialized technology
• Home renovations
• Specialized clothing or shoes
• Uninsured treatments that improve overall wellness and function
• Exercise equipment
• A different vehicle or vehicle modifications
• Smart home products
• Support with activities of daily living like cleaning and meal preparation

Some people may invest the money into a TFSA, RRSP, or RESP. Many beneficiaries of critical illness insurance have used the money to make priceless memories by travelling with family and friends. 

One of the most often overlooked features of critical illness insurance is that it is not only for employed people. In fact, it is sensible to have coverage for stay-at-home parents and other eligible dependents. In addition to covering treatment costs, it can provide income replacement so that partners can take time off work to care for their loved one. 

If you think you won’t need critical illness insurance, think again. Jane (not her real name) was in her 30’s when she was diagnosed with stage 4 cervical cancer. She had a critical illness insurance policy in place and quickly received her benefit payment. She was also refunded the premium payments that had made up until her date of claim. This money allowed her to

• Get a private MRI within 24 hours,
• Travel to the United States for timely surgery and treatment, and
• Access childcare for her children so that she could focus on her recovery. 

The critical illness insurance benefit alleviated significant financial strain for Jane and her family. It helped cover her husband’s lost income when he missed work to attend appointments with her. Jane’s experience would have been much more stressful and prolonged without critical illness insurance.

Now that you know more about critical insurance and how it works, take another minute to think about the impact this benefit could have if you ever find yourself eligible to make a claim. There would undoubtedly be less stress and opportunities for a better quality of life.   

Get in touch with us if you want to chat about this low-cost insurance benefit. We have over 30 years of experience helping people pick the right critical illness insurance policy.