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Critical Illness

Critical illnesses are illnesses which might prove fatal and require intensive treatments. Such treatments are quite expensive and pose a burden on every common man’s finances. Critical illness health plans, therefore, prove quite useful. These plans help in meeting the high costs associated with critical illnesses. As such, the plans provide financial security. Let’s understand the concept and working of a critical illness health insurance plan.

 

What are critical illness health plans?

Critical illness health plans are fixed benefit health insurance plans which cover a specified list of critical illnesses. Some common illnesses covered include cancer, stroke, heart attack, major organ transplants, liver failure, lung failure, multiple sclerosis, etc. If the policyholder is diagnosed with any of the covered critical illnesses during the term of the plan, the sum insured is paid in lump sum irrespective of the actual medical costs incurred.

 

What is not covered under critical illness plans?

There are some exclusions that are commonly found in almost all critical illness insurance plans. These exclusions are as follows:

  • Illnesses or treatments occurring within 60 to 90 days of buying the policy

  • Pre-existing illnesses during the waiting period

  • Congenital defects, ailments, or diseases

  • Diseases occurring due to alcohol or drug abuse

  • HIV/AIDS infections

  • Illnesses due to war or war-like situations

  • Maternity related illnesses

  • Death due to critical illness during the survival period

 

Why are critical illness insurance plans necessary?

 

  • Rising illnesses

     

    Illnesses like cancer, heart-related ailments, etc. are on the rise. Nowadays, many individuals are getting afflicted with common critical illnesses and are requiring intensive treatments. A critical illness plan, therefore, proves to be relevant.

  • Expensive treatments

     

    Treatments required for critical illnesses are very expensive. Individuals, thus, need a specially designed plan which pays for such expensive treatments where normal health insurance might prove to be insufficient.

  • Flexible usage of benefits

     

    The best part about critical illness plans is that the benefit received can be used in any way. A lump sum amount of money is paid which you can use for availing of advanced treatments or for any other financial liabilities which you have.

  • Tax benefits

     

    The premiums which are paid for a critical illness plan are allowed as a tax deduction under Section 80D. Thus, you can avail of tax benefits too from a critical illness policy.

  • Supplementing health insurance

     

    Critical illness plans can be used to supplement an existing health insurance plan in the event of facing any critical illness.

 

How to buy critical illness insurance plans?

Given the importance of critical illness plans, many health insurers offer a critical illness policy. However, when buying critical illness plans, you should be careful. A plan must be bought only after comparing it with other available plans. To compare, the following parameters should be used:

 

  • The illnesses covered

     

    Look at the number of illnesses covered by the different plans. The higher the number of illnesses covered, the wider the scope and the better the plan.

  • The sum insured levels allowed

     

    Critical illness plans allow coverage up to specified levels. Look for these levels. Match your coverage requirement with the allowed coverage levels and choose a plan which offers the coverage amount you require.

  • Premium rates

     

    The last parameter should be the premium rate of the plan. Critical illness plans have low premium rates. When comparing, compare the premium vis-à-vis the coverage offered.

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