It’s a famous heart surgeon in the world, Dr. Marius Barnard, who created a critical illness insurance, because he saw how the financial stress that accompanies cancer, heart attacks and stroke kill patients. This type of insurance usually provides a lump-sum cash payment if you are diagnosed with one of the diseases specified in your critical illness policy.
No matter how you are going to use the money, critical illness insurance always does one thing: It reduces the financial stress.
But one of the challenges of critical illness insurance is to understand the many ways you can use the benefits of paid-money-if you ever need them. Here are some ways that I see:
1. To pay deductibles, copays and cost out-of-pocket health-related other.
This is the most obvious use, especially since the cost of deductibles and out-of-pocket for health insurance plans continues to increase.
2. Costs not covered by health insurance such as travel, hotel, babysitting, etc.
I know people who have great health insurance plan. He was diagnosed with colon cancer. His doctor told him, “You need to go to MD Anderson.” The complexity of the whole problem, he and his wife had just had a child. So, they took the father-in-law along to watch his son. He should fill the air tickets, dining and hotel charges to the credit card. A few years later, he is still paying off the credit card.
3. Income protection, especially for the self-employed.
If the self-employed have income protection plan, including disability insurance, are likely to have a period of 90 days prior to the elimination of benefits paid. One self-employed person I know was diagnosed with cancer. He will take his chemotherapy treatment on Friday. Then he will use the weekend to recover and try to get back to work on Monday or Tuesday. He did not miss enough working days to fulfill its elimination period. Whether the cancer affects income? Significantly!
4. Mortgage protection.
Many people buy life insurance so that if something happens to them, the family home will be paid off and the family will be able to stay at home. But what is more likely to occur while paying on a mortgage-death or critical illness? Depending on your age, you could be as much as four times more likely to suffer from a critical illness while paying a mortgage than to die.
Typically, insurance cover from two to five years of mortgage payments will help significantly through the transition. A great question of thinking is, “Does it reduce your financial stress if you are diagnosed with cancer to know your mortgage will be paid for two years?”
5. Retrofit your home or car.
I had a woman tell me that her husband had suffered a stroke. The pair had to take a second mortgage to make modifications to their homes, including the wheelchair, a significant change to their bathroom, and widening the doors to accommodate a wheelchair.
No matter how you are going to use the money, critical illness insurance always does one thing: It reduces the financial stress. There is always emotional stress for families with a family member who has a critical illness. emotional stress increases directly with financial pressures. A critical illness plan reduce financial stress, which then reduces emotional stress. If you want to learn more about this important coverage, contact your insurance agent or advisor.