What is Critical Illness?
Let’s understand the term critical illness, it refers to illnesses that are fatal such as cancer, heart attack, kidney failure, brain surgery, tumor, muscular dystrophy, permanent paralysis, organ transplant, and so on. Treatment for a serious illness requires a long procedure that involves regular hospital visits, medical tests, doctor’s fees, medicine, etc.
It’s suggested to have critical illness insurance along with a health plan as it ensures the coverage of the illness. Under basic health insurance, there are terms and conditions attached to critical illness coverages therefore the security is not 100% which can be troublesome as managing expenses at such short notice can be nerve-wracking for families.
How does critical illness insurance work?
This insurance plan provides a lump sum payout which helps in bearing the medical expense of the same.
Under Critical illness insurance, one can get a lump sum payout on the basis of diagnosis. Unlike health insurance where one can receive the reimbursement or cashless claim settlement only after being hospitalized. This plan provides a one-time large payment with which a policyholder can cover the expense of a costly treatment that is not covered by their health insurance plan. The costs associated with multiple visits, such as doctor’s fees, medical tests, etc., are covered by critical illness insurance. Also can be used as per personal requirements which can be either treatment expenses or household expenses, child’s education, etc.
To prevent situations where critical illness isn’t covered under a health plan, it’s important to go through the policy’s terms and conditions where it’s clearly mentioned whether it’s comprehensive or partial. It is advised to have both critical illness insurance and a health insurance plan, this ensures 100% security that the illness will be covered. Basic health insurance comes with terms and conditions that limit its ability to provide, which can be problematic for families.
Critical illness Insurance vs. Health insurance plan
Between health and critical illness health insurance, there are several differences. Among them are:
| Parameters | Critical illness Insurance | Health insurance plan |
| Meaning | The costs of treating deadly diseases like cancer, heart attacks, and tumors are covered under critical illness insurance. | It provides pre-and post-hospitalization expenses together with medical coverage. |
| Benefits | Depending on the diagnosis, one may receive a lump sum payment. No hospitalization is necessary. | One can receive compensation or a cashless hospitalization option after being hospitalized. |
| Waiting Period | The waiting period is determined by the severity of the sickness | 30 days of waiting are allowed if certain conditions are met. |
| Validity | Valid until the sum assured is used up or the policy expires. | Valid until the conclusion of the claim or the policy’s expiration. |
What is the critical illness insurance coverage?
Critical illness cover 36 main diseases and another depending disease also depends on the type of plan. The list of disease are:
| 1. Cancer | 10. Muscular Dystrophy | 19. Hepatitis (Fulminant Viral) | 28. Terminal Illness |
| 2. Heart Attack | 11. Third-Degree Burns | 20. Coronary Artery Disease | 29. Loss of Independence |
| 3. Stroke | 12. HIV | 21. Encephalitis | 30. Major Organ Transplant |
| 4. Kidney Failure | 13. Cardiomyopathy | 22. Head Trauma | 31. Primary Pulmonary Arterial Hypertension |
| 5. Multiple Sclerosis | 14. Loss of Speech | 23. Medullary Cystic Disease | 32. Severe Coronary Artery Disease |
| 6. Parkinson’s Disease | 15. Chronic Aplastic Anemia | 24. Brain Surgery | 33. Heart Valve Surgery |
| 7. Alzheimer’s Disease | 16. Blindness (Permanent) | 25. Coronary Artery Bypass Surgery | 34. Angioplasty |
| 8. Brain Tumor (Benign) | 17. Bacterial Meningitis | 26. Lung Disease (end-stage) | 35. Coma |
| 9. Paralysis (limbs) | 18. Liver Failure (end-stage) | 27. Surgery of the Aorta | 36. Deafness (Permanent) |
Benefits of critical illness insurance
- Pay for hospital stays and medical expenses
- Pay for medical expenses even when received abroad
- Provide financial support if a worker requires time off for medical care.
- Provides coverage for a variety of expenses you receive a lump sum payment under this plan that you can apply toward treatment costs, home expenses, child’s education, etc. as needed.
- The stress of paying for pricey treatments is no longer a problem, providing you with peace of mind.
- Critical illness insurance provides a tax benefit under section 80D, and the payoff is tax-free.
Critical illness inclusion and exclusion
Depending on the policy, exclusion may change
| Inclusions | Exclusions |
| Cancer | Pre-existing disease |
| Regular dialysis is necessary due to kidney failure | Injury with Intent |
| HIV/AIDS Organ Transplant | War, riot, or strike-related permanent paralysis injury |
| Permanent paralysis | Genetic disease |
| 36 serious conditions |
