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Critical Illness Insurance

A critical illness insurance policy covers the insured against life-threatening critical illnesses such as cancer, heart attack, renal failure etc. This insurance policy provides coverage in the form of a lump sum at the time of diagnosis of a covered illness. The lump sum can be used for the treatment expenses.

Upon surviving a minimum number of days, the insured can avail the policy benefits as per the applicable terms and conditions.

Features of Critical Illness Insurance Plans

Here are the features of critical illness insurance plans:

  • Critical Illness Coverage- Coverage is provided for up to 36 major critical illnesses such as a tumour, cancer, kidney failure, heart ailments etc.
  • Lump-sum Payment- The insurer provides the lump sum payment for the treatment of covered illnesses.
  • Easy Claim Processing- The claim can be easily processed based on the diagnosis report(s).
  • Waiting Period- Usually, the coverage is provided after the end of the waiting period.
  • Loss of Income- A part of the lump sum can be used as an income replacement.

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Advantages of Critical Illness Insurance

Have you ever wondered, what will happen to you and your family if you can’t earn as a result of a critical illness? On top of that, how will you take care of your incurred medical expenses?

We don’t want you to get scared, we want you to be aware of the severe situations that a critical illness can bring along.

Buying a critical illness health insurance policy is a foolproof way of securing your future against critical illnesses. It will provide you with a lump sum amount upon diagnosis of covered critical illnesses.

Tax Benefits under a Critical Illness Insurance Policy

The policyholder can avail tax benefits under the Income Tax Act, 1961. Tax exemption of up to Rs. 15,000 can be availed under Section 80D of the Income Tax Act, 1961. Senior citizens can avail tax benefit up to Rs. 20,000 under the same section.

What is an Ideal Critical Illness Insurance Plan?

In order to come across an ideal critical illness plan, check for the below parameters:

Parameters Details
Sum Insured should be 4-5 times of the annual income.
Waiting Period Should Below
Premium Should Below
Number of Disease Covered Should Be Extensive
Maximum Renewability Age Should Be High

Critical Illness Insurance Plan vs. Health Insurance Plan

When Neeraj was diagnosed with a brain tumour, he was completely shattered.

His health insurance policy having a sum assured of Rs 10 Lakh took care of the incurred treatment expenses. Having said that, he was devastated when the revenues of his business started falling down. Due to the severity of his illness, he was unable to take care of his business. As a result, the financial health of business deteriorated (along with his health).

There are many people like Neeraj who don’t know that a health insurance policy is different from a critical illness insurance policy.  

Here are the differences between a critical illness insurance plan and health insurance plan.

Parameters Critical Illness Insurance Plan Health Insurance Plan
Meaning It covers life-threatening diseases like tumour, permanent paralysis, etc. It provides comprehensive health insurance coverage including hospitalization expenses.
Benefits Hospitalization is not required to avail policy benefits. Diagnosis is enough to get lump-sum payment. The insured can get the reimbursement of incurred hospitalization expenses by submitting bills. He can also avail cashless facility at network hospitals.
Coverage It offers coverage for up to 36 critical illnesses. It offers extensive coverage, including pre-hospitalization expenses and post-hospitalization expenses
Waiting Period There is a waiting period that depends on the severity of illness. There is a waiting period of 30 days.

Read More About Why You Should Buy Health And Critical Illness Insurance Separately

Critical Illness Plans

Illnesses Covered in Critical Illness Insurance

Generally, critical illness insurance plans cover the following illnesses:

  • Cancer up to specified stage
  • Heart attack (first time)
  • Open heart coronary artery bypass grafting
  • Open heart replacement or repair of heart valves
  • Coma of specified severity
  • Kidney failure that requires regular dialysis
  • Stroke
  • Major organ transplant
  • Bone marrow transplant
  • Permanent paralysis of limbs
  • Motor neuron disease, also known as amyotrophic lateral sclerosis (ALS)
  • Multiple sclerosis
  • Aplastic anaemia
  • Bacterial meningitis
  • Loss of speech
  • End-stage liver disease
  • Deafness
  • End-stage lung disease
  • Fulminant viral hepatitis
  • Major burns
  • Muscular dystrophy

Disclaimer- This list is only indicative and not exhaustive. Insurance companies cover various critical illnesses under different critical illness insurance policies.

Exclusions in Critical Illness Insurance Policy

Generally, critical illness plans don’t provide insurance coverage for the following:

  • Covered critical illness diagnosed within the waiting period
  • Death within 30 days of diagnosis of critical illness or surgery
  • Critical illness developed due to smoking, tobacco, alcohol or drug intake
  • Critical illness developed due to internal or external congenital disorder
  • Pregnancy or childbirth-related critical condition
  • HIV/AIDS
  • Illness caused/ developed due to war, terrorism, civil war, navy or military operations
  • Any dental care or cosmetic surgery
  • Infertility treatment/ treatment to assist reproduction
  • Hormone replacement treatment
  • Treatment underwent outside India

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The Need for a Critical Illness Policy

Now, the need for a critical illness policy is more than ever. The sedentary lifestyle pf 21st-century is giving rise to all kinds of illnesses, most of which are critical in nature. Different studies indicate a steady rise in the number of people falling prey to critical illnesses. While the number of people developing/ contracting critical illness is increasing, the age at which people develop critical illnesses is consistently decreasing. This means that millennials are prone to developing critical illnesses as compared to the earlier generations.

Who Can Benefit From Critical Illness Insurance Plan?

Anyone and everyone stands to benefit from taking a critical illness policy. The modern-day hectic lifestyle is a harbinger of lifestyle-related illnesses including critical illnesses like cancer, heart attack, stroke, etc.

A critical illness can reduce the ability of patients to earn. It is because the patient is often sick and home-bound. The reduced ability to work in some cases leads to not being able to work at all. This triggers a financial crisis.

To prevent such situations, one can opt for a critical illness policy.

Who Should Buy Critical Illness Insurance Policy?

With hospitals spending heavily on super-speciality equipment, the treatment is getting better day-by-day. Due to this and medical inflation, the cost of treatment is increasing. When a person is hospitalized, incurred medical costs can go sky-high.

For women having breast cancer, Herceptin (breast cancer drug) can cost a bomb. While undergoing the treatment, the patient needs at least 16 vials. You can imagine how much a patient needs to spend during the treatment.

Keeping in mind the treatment expenses for critical illness, opting for the best critical illness plan seems to be a viable option.

Here is who all can get benefitted from a critical illness policy:

Those with a History of Critical Illness in Their Family

Many critical illnesses are hereditary in nature, i.e. they run in families. One is at a much higher risk of developing a critical illness if there is a family history of the same. Those with a history of critical illness in their family should definitely opt for a critical illness insurance policy.

Primary Breadwinners

The role and importance of the primary breadwinner of a family are paramount. If something happens to them, the family’s financial future will be severely affected. The family may even have to face unpleasant financial situations.

That’s why earning members of a family must buy critical illness insurance cover, especially if they have a medical history.

Those Having High-Pressure Jobs

Critical illnesses have a high correlation with high-pressure jobs. Various studies indicate that people working in high-pressure work environments are at increased risk of developing a critical illness. Employees having a job that puts high-pressure on them such should definitely opt for a critical illness policy.

People Over the Age of 40 Years

People over the age of 40 years are more susceptible to developing critical illnesses. It is advised that they buy a critical illness insurance policy in their late thirties. Moreover, they are likely to be in a better financial position and can pay policy premium easily.

Factors to Keep in Mind While Opting for a Critical Insurance Policy

Here are various factors to check before opting for a critical illness insurance plan:

Sum Assured

The amount of cover is essential to determine which policy works for you. Treatment for some critical illnesses costs comparatively lower than the others. Knowing how much coverage you want will help you choose the right plan for your needs. Get a critical illness insurance quote from our website to come across the critical illness insurance that works for your needs.

Standalone Critical Illness Insurance Policy or Critical Illness Insurance Rider

Since a standalone policy attracts a higher insurance premium as compared to a rider, it offers comprehensive coverage. The scope of coverage offered by a standalone critical illness insurance plan is higher as compared to a rider. Though, a rider may provide the insurance against the same set of critical illnesses, the amount of cover or the sum assured will be way lesser.

This is due to the fact the rider is actually dependent on the base policy. For instance, if the healthcare policy or mediclaim is for Rs. 2 lakh, then the critical illness rider will provide insurance coverage only for Rs. 2 Lakh.

To enjoy a comprehensive insurance coverage, insurance experts recommend opting to opt for a standalone plan.

Sub-Limits

Checking the sub-limits under a critical illness insurance policy is important as they have repercussions on the costs you would have to bear. Sub-limits are applicable to the total sum assured under a critical illness insurance plan.

For instance, if a critical illness insurance policy having Rs. 5 Lakh sum assured comes with a sub-limit of Rs. 1.5 Lakh for tests and Rs. 2 Lakh for surgery, will cover up to 3 Lakh. Depending on the incurred expenses, you will have to pay up to 2 Lakh from your own pockets.

Some critical illness insurance policies offer a higher amount of cover for surgeries while others may have a higher cover for tests. It is important that you have fair information about the limitations before opting for a critical illness insurance plan

Inclusions and Exclusions

Though the general inclusions and exclusions of a critical illness insurance policy are mentioned above,  you should check the exact inclusions and exclusions in the policy brochure. It will help you get a better understanding of the plan.

For instance, a critical illness insurance policy focusing more on cardiovascular diseases may have exclusions such as cataract or cancer. If you are looking for a specific set of illnesses to insure against, please make sure you check the details beforehand.

Age

The critical illness insurance policies catering to senior citizens offer wider coverage and attract a higher insurance premium. This is because senior citizens are at a higher risk of developing critical illnesses as compared to young adults.  

The insurance experts recommend opting for a critical illness insurance plan as per your age group.

Maximum Renewal Age

Some critical illness insurance policies provide coverage up to a specified age while others provide lifelong coverage. You ought to know the exact age up to which you, as an insured, can renew the plan. For some plans, you can’t renew beyond, say 60 years.

The insurance experts recommend opting for a critical illness insurance plan with a maximum renewal age.

Waiting Period

Generally, critical illness insurance policies come with a waiting period. This means that the policyholder can avail insurance coverage for covered critical illnesses after the end of the waiting period.

The insurance experts recommend opting for a critical illness insurance plan with a low waiting period.

How to File a Claim for Critical Illness Policy?

If there is a need to file a claim, contact your insurance company and register your claim. Usually, the following documents are required to file a claim:

  • Duly filled claim form
  • Photocopy of ID card
  • Medical certificate obtained from a doctor confirming the dia gnose of critical illness
  • Detailed discharge summary

After receiving the above documents, the claim team would verify the details. Based on the verification, your claim will be approved or disapproved. Whatever the case may be, it will be intimated to you.

Note: The insured may have to provide additional documents depending upon the claim.

How Can PolicyBazaar Help You?

Treatment for a critical illness can wipe out your savings in a single go. You can opt for a critical illness plan and secure your financial future. You can compare and find the best critical illness plan in a matter of a few clicks at PolicyBazaar.

We can help you evaluate available insurance policies according to your insurance needs. We will help you come across the plan that offers the best insurance benefits at best insurance premium. Our trained customer care executives will guide you so that you’ll get the right protection you need.

At PolicyBazaar, you can avail the following benefits:

  • Get free quotes from leading insurers
  • Critical illness plans at lowest premium
  • Instant issuance of critical illness policy online

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Written By: PolicyBazaar - Updated: 13 August 2019
Insurer Plan Name No of Diseases Covered Key Features Exclusions
Religare Assure 20
  • Zero day survival period
  • Accidental Death Coverage
  • Tax Benefit
  • Any pre-existing illness.
  • AIDS treatment medical expenses
  • Congenital disease
  • Cosmetic & aesthetic and obesity related treatment
  • Infertility and in vitro fertilization related tests and treatment
  • War, riot, strike, nuclear weapons induced hospitalization.
Bharti AXA General Insurance Smart Health Critical Illness - Lump sum 20
  • No Claim Bonus of 5%
  • Family Option Available
  • Tax Benefit U/s 80 D
  • Disease contracted in initial 60 days
  • Treatment traceable to pregnancy
  • AIDS or HIV or ARCS-AIDS related Complex Syndrome
Max Bupa Health Insurance Health Assurance Critical Illness 20
  • No Claim Bonus of 5%
  • Riders Available
  • Tax Benefit U/s 80 D
  • Disease contracted in initial 90 days
  • AIDS, related syndromes & HIV
  • Failure to seek or follow Medical Advice
Reliance General Insurance Reliance Critical Illness 10
  • No Claim Bonus of 5%
  • Tax Benefit U/s 80 D
  • 1 yr and 3yr Payment Option
 
Total Health Plan 1 17
  • Hospitalization benefit
  • Medical reimbursement benefit
  • Tax Benefit U/s 80 D
  • Disease contracted in initial 90 day
  • Dental treatment or surgery
  • AIDS treatment medical expenses
Total Health Plan 2 17
  • Hospitalization benefit
  • Medical reimbursement benefit
  • Tax Benefit U/s 80 D
  • Disease contracted in initial 90 day
  • Dental treatment or surgery
  • AIDS treatment medical expenses
HDFC ERGO General Insurance Critical Illness Plan 8
  • Tax Benefit U/s80 D
  • Disease contracted in initial 90 days
  • War and terrorist attacks
  • STDs, AIDS, Venereal diseases
HDFC Life Cancer Care Silver 1
  • Lumpsum on detection of Cancer
  • Waiver of Premium for 3 years
  • Tax Benefit U/s 80 D
  • No benefit shall be payable under the policy in respect of any Major Cancer
  • Carcinoma-in-situ or Early Stage Cancer resulting directly or indirectly from or caused or contributed by (in whole or in part)
  • Sexually Transmitted Diseases AIDS or HIV
  • Any congenital conditions
  • Any pre-existing condition
  • Nuclear, biological or chemical contamination (NBC)
Cancer Care Gold 1
  • No Claim bonus upto 200% of SA
  • No medicals
  • High Sum Assured Rebate
  • No benefit shall be payable under the policy in respect of any Major Cancer
  • Carcinoma-in-situ or Early Stage Cancer resulting directly or indirectly from or caused or contributed by (in whole or in part)
  • Sexually Transmitted Diseases AIDS or HIV
  • Any congenital conditions
  • Any pre-existing condition
  • Nuclear, biological or chemical contamination (NBC)
Cancer Care Platinum 1
  • Income payout - 1% of SA per month
  • Least documentation
  • Cover upto 40 lacs & 20 years
  • No benefit shall be payable under the policy in respect of any Major Cancer
  • Carcinoma-in-situ or Early Stage Cancer resulting directly or indirectly from or caused or contributed by (in whole or in part)
  • Sexually Transmitted Diseases AIDS or HIV
  • Any congenital conditions
  • Any pre-existing condition
  • Nuclear, biological or chemical contamination (NBC)
Apollo Munich Health Insurance Optima Vital 37
  • Tax Benefit U/s80 D
  • 37 Critical Illnesses covered
 
ManipalCigna Health Insurance Basic 15
  • Tax Benefit U/s80 D
 
Enhanced 30
  • Annual Health Check up
  • Organ Donor Cover
  • Converted to Comprehensive health plan after 4 years
 
Edelweiss Tokio ET Criticare+ 17
  • Upto 1 cr Lumpsum
  • 3 claims under Multiclaim
  • Tax benefits under Section 80D & 10(10)D
 
PNB Metlife MetLife Major Illness Premium Back Cover 35
  • Return of premium
  • 5% online discount
  • Tax benefits under Section 80C, 80D & 10(10)D
 
AEGON Life iCancer 1
  • All types of cancer,except skin
  • Covers all stages of cancer
  • Tax Benefit U/s 80 D
 
Q:

What is Critical Illness?

Ans:

Critical Illness cover comes as a rider as well as a stand-alone plan. It provides the insured with a lump sum, in case he/she gets diagnosed with a critical illness such as cancer, multiple sclerosis, heart attack, paralysis, kidney failure, etc. The insured has to bear 30 days waiting period before the first diagnosis can be claimed.

Q:

Why do we need Critical Illness Insurance Cover?

Ans:

More often than not, critical illness is considered as an exclusion in a standard health insurance policy. Even if covered, the lump sum paid out is simply not enough to suffice the whopping expenses incurred in the treatment of such critical illness.

So, getting a critical illness insurance plan is imperative to ensure your financial security.

Q:

What are its key features of critical illness insurance?

Ans:

It covers major illnesses which are usually excluded from a standard health insurance policy. It provides a lump sum to the insured upon the diagnosis of the covered illness. For most critical illness insurance plans, no medical check-up is required up to 45 years of age. It provides tax benefits and no-claim benefits.

Q:

How much critical illness cover do I need?

Ans:

Your age, lifestyle pattern, city of residence and annual income are vital parameters that help to determine the appropriate coverage required for you.

Q:

What are the documents required for critical illness insurance?

Ans:

Generally, age proof, address proof and identity proof are required. Additionally, specific documents may be required in case the insurance buyer needs to undergo medical tests.

Q:

Does life insurance cover critical illness?

Ans:

Yes, under add-on rider, life insurance plans offer coverage against specific critical illnesses.

Q:

Can I get critical illness cover after cancer?

Ans:

Most insurers provide coverage to insured having insurance prior to the diagnosis. Varying from one insurer to another, there are some plans that offer coverage after the diagnosis as well.

Q:

How much cover do I need?

Ans:

Your age, lifestyle pattern, city of residence and annual income are vital parameters that help to determine the appropriate coverage required for you.

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