What is Critical Illness Insurance?

This is a pretty common question I get from clients.  Many assume it is like the long term or short term disability plans they may be offered through their employer.

In fact, critical illness insurance is quite different, although the critical illness plans work well with long term disability benefits.  Most commonly, critical illness insurance provides you with a lump sum benefit to help support you financially if you are diagnosed with and survive a covered critical illness. You can use it to augment your health insurance plan and any group disability coverage you may have.

The lump sum can be used in a number of ways:

• Selecting different treatment options:In Canada, you can access  medications and treatment that may not covered by provincial health plans. Outside Canada, you can pay for medical care that may not be available at home, in addition to your family’s travel and lodging expenses.
• Managing your financial situation: Pay down your mortgage, reduce your debt or pay off a credit card. or reduce your mortgage, credit cards or other debts. Help keep your business running.
• Improving your mobility.   You may need to hire help to assist you with your recovery, or modify your stairs or car to get around easier.
•  Flexible spending: use the benefit in a number of ways that can help you get better – counseling, time with your family, a spouse’s leave of absence from work.

While no one wants to think about getting cancer or having a heart attack or stroke, the reality is that most Canadians either will experience or will know someone in their family who will undergo this type of health situation.  While we need to do our best to live healthy lives, we also need to plan for these types of situations to minimize the potential financial risk that we and our families could experience.  Many of the expenses associated with critical illness (like modifications to your home, private nursing, child-care) may not be covered under our existing provincial health plans, so additional funds to reduce that financial stress are critical.

Critical Illness Insurance Plans

When you are looking at critical illness plans, it’s also important to explore the other options that the provider offers.  Plans can include access to leading-edge doctors, daily living assistance benefits and counseling services.

There are a variety of options and ways of structuring your critical illness insurance plans and a good advisor will be happy to explore the type of plan that best meets your needs.

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