Categorized | Health Insurance

steps to choose critical illness benefit

Acute illness can result in loss of income, partial or total disability and a change in your lifestyle. The financial burden that you may have to bear in the case of an acute illness can be much more than what your Indemnity Health Insurance plan covers, as this type of plan may only pay hospital bills. That is why it is necessary to understand-what is health insurance. The best way to overcome the shortcomings of an indemnity plan is to buy a Critical Illness plan. Where an indemnity Policy only covers the hospital bills, a critical illness plan will pay a lump sum if you are diagnosed with a serious ailment which is listed in the policy document. This amount of money that you get can be utilized in several ways like paying for expensive treatment or recuperation aids. You can also use it to make up for loss of income due to the acute illness. Both types of insurance plans have their own benefits. A critical illness plan is a supplement for your medical health insurance plan.

How to balance

The purpose of an acute or critical illness plan is to pay for expensive treatments. It is much cheaper as compared to an indemnity plan. This is because a comprehensive health plan covers a wide range of risks whereas an acute illness plan covers specific situations. A combination of comprehensive health insurance and acute illness cover can provide a decent balance between Coverage and pricing.

What you should buy

Acute illness plans are fixed benefit plans. You will get the entire sum Insured regardless of whether you are hospitalized or what the expenses of the treatment are. However, the health insurance benefits can be different for different plans.

•    Most plans have a survival period clause that states that the Policyholder should survive for at least 30 days after being diagnosed with the acute illness. However, some insurance companies do not have this clause.

•    The number of acute illnesses covered by different companies is also different.

•    The built in coverage is also different with different companies. For instance, some insurers cover accidental death and disability due to accidents while others do not.

You should evaluate and compare more than one health insurance policy to decide which one suits you the best.
There are some points that you need to consider while choosing an acute illness policy. The first thing that you need to consider is the coverage of the policy. You should consider factors like recurring costs, treatment costs, and future financial liabilities in case of income loss. Also, take into account existing policies like personal Accident and disability policy or health insurance.

Another thing that you need to consider is whether you should take this policy as a standalone policy or as a rider. Although an acute illness plan can be bought separately, acute illness Riders are usually attached with health or life insurance plans. The terms and conditions of the policy under both these options are similar. It is up to you to make a choice between a rider and a standalone policy.