You never know when a severe illness may develop, like cancer or a heart attack, significantly affecting the peace of life. These types of circumstances not only affect your personal life but also drain your hard-earned savings with medical expenses.
In such cases, critical illness insurance can be a lifeline. It will shield you from the excessive monetary pressure during your times of need. Therefore, keep reading to understand more about this policy and how it can affect your life.
What is Critical Illness Insurance?
Critical illness health insurance is a bespoke health policy that pays a lump sum upon diagnosis of a pre-specified life-threatening illness, like cancer, heart attack, stroke, kidney failure, or organ failure.
In contrast to standard health insurance, which pays hospitalization expenses, this cover provides a single cash benefit to meet medical treatment, recuperation, and lifestyle modifications. The main objective is to relieve the economic pressure caused by the high costs associated with treating critical illnesses.
This policy protects against economic hardship so that people can focus on recovery without the burden of costs. It is particularly worthwhile for people with a genetic history of disease or risky professions. Before choosing a plan, always compare health insurance policies to ensure you’re getting the best value and coverage.
What are the Benefits of Critical Illness Insurance?
Discussed below are the key advantages of critical illness insurance:
- Monetary Support During Emergency
Upon the diagnosis of a critical disease, the emotional distress and financial burden accompanying the physical damage can ruin an ordinary household. Recovery from major diseases such as cancer, organ transplant, or stroke is not only lengthy but also expensive.
Besides, lost earnings from lost work days during recuperation could increase the economic burden. A critical illness policy meets those issues by offering instant, lump-sum financial assistance so that you can focus on getting better rather than stressing about payments.
- Comprehensive Disease Protection
Most critical illness insurance policies pay for a broad range of significant ailments, such as cancer, kidney diseases, heart attacks, stroke, paralysis, blindness, major organ transplants, and so on.
Rather than purchasing individual policies for every disease, a critical illness insurance policy provides multi-disease coverage, making your insurance planning comprehensive.
- Income Replacement During Recovery
If you are the sole provider or your family’s primary breadwinner, a severe illness would significantly impact your household’s financial well-being. A lump sum payment from a critical illness plan enables you to replace diminished income, cover daily needs, and preserve your lifestyle while receiving treatment and recovery.
- Supplements Your Existing Health Insurance
A standard health insurance policy may not be sufficient to cover long-term or costly care. Critical illness insurance is an add-on and fills the gap by paying for costs that regular plans may not cover, such as experimental treatments or prolonged home care.
- Reasonable Premiums
Unlike general assumptions, critical illness coverage can be found at affordable premiums, particularly when purchased earlier. Its value as a source of financial security and peace of mind is priceless, making it a wise investment in health.
- Funding for High-Cost Treatments
Some life-threatening conditions may need extraordinary treatment measures such as the latest therapies, experimental treatments, specialized drugs, or alternative medicine.
Policyholders may access the required care with the best health outcomes without financial constraints when they have critical illness insurance. This will provide the financial support to help you pursue the most suitable and advanced treatments.
- Tax Benefits
Premiums for critical illness coverage are tax-deductible under Section 80D of the Income Tax Act. You can claim a maximum of ₹25,000 per year, and as a senior citizen, you can claim ₹50,000 more—giving you a double benefit of protection and tax relief.
What are the Inclusions Under Critical Illness Insurance?
Mentioned below are the major diseases that are covered under the critical illness insurance policy:
- Heart attack
- Heart valve replacement due to body abnormalities or defects.
- Kidney failure
- Aorta surgery is performed through laparotomy or thoracotomy.
- Cancer
- Stroke
- Major organ transplants such as the heart, kidney, liver, or bone marrow.
- Multiple sclerosis
- Fulminant viral hepatitis
- Paralysis results in complete and permanent loss of one or more limbs, also known as paraplegia.
- Permanent or total deafness
- Permanent or total blindness
- Parkinson’s disease
- Coma
- Degenerative brain disorders, including Alzheimer’s disease.
- Terminal illness
- Chronic lung disease
- Motor neuron disease
- Muscle dystrophy
- Benign brain tumour
- Encephalitis
- Poliomyelitis
- Craniotomy or brain surgery
- Full-blown AIDS (acquired immune deficiency syndrome)
- Universal necrosis of the brain cortex, also known as Apallic syndrome
What are the Exclusions Under Critical Illness Insurance?
Even though critical illness insurance provides comprehensive coverage for several ailments, it is necessary to know what is excluded to prevent claim rejection. Significant exclusions are as follows:
- Diagnosis of critical illness within the initial waiting period (90 days typically)
- Death of the policyholder within the survival period (usually 14–30 days after diagnosis)
- Injuries caused while engaging in adventure or risky activities
- Pre-existing health conditions that were not disclosed at the time of purchase
- Injuries suffered during active defence or military service
- Illnesses associated with alcoholism, drug abuse, smoking, or substance abuse
- Medical conditions arising out of war, terrorism, or civil war
- Fertility treatments and associated medical interventions
- Self-inflicted injuries, attempted suicides, or intentionally caused injuries
- Cosmetic surgeries, plastic surgeries, and standard dental care
- Diseases transmitted through sex, including HIV/AIDS
- Treatments sought outside India unless specifically covered
- Congenital disorders (internal or external) resulting in serious illness
Who Should Avail of Critical Illness Insurance?
Availing a critical illness insurance policy is a prudent decision for many different types of people, such as:
- People with a Family History Risk: If there is cancer or heart disease in your family history, your risk increases. Consider early intervention and insurance.
- Breadwinners: If you provide a substantial source of income for your family, a critical illness diagnosis could ruin your source of livelihood. Under such circumstances, critical illness insurance can come in handy.
- Professionals in High-Stress Occupations: People who work in stressful or risky work conditions are more likely to be exposed to health threats and must avail themselves of early protection.
- People over 40: Health threats grow with age. Buying a policy by age 40 provides coverage during the most exposed years of your life.
- Women: Due to the growing prevalence of diseases such as breast and cervical cancer, coverage for critical illnesses provides women with another layer of health protection.
These days, when medical inflation is rising, opting for a critical illness insurance plan has become an essential part of life. It not only protects you against the exorbitant expense of treatment but also secures your family’s financial future.
For comprehensive and reliable critical illness coverage, Star Health is renowned for its Star Critical Illness Multipay Insurance Policy. It provides extensive financial protection against essential diseases and ensures convenient and speedy claim settlements. This policy falls under the broader category of Types of Health insurance.
FAQs About Critical Illness Insurance
1. What are the top three most common claims for a critical illness policy?
The illnesses typically covered under a critical illness policy include cancer, heart attack, and stroke, but not all instances of these are covered.
2. Is a ₹10 lakh health insurance plan enough for critical illness coverage?
Availing a ₹10 lakh health insurance plan can provide considerable financial support in the event of a serious illness. The adequacy is based on treatment expenses, age, and health requirements. Hence, it is crucial to consider your risk and establish the appropriate level of coverage.
3. How long must I wait to access my critical illness insurance benefits?
Critical illness insurance has a waiting period of 90 days. It starts on the coverage’s start date and ends on the date of the first diagnosis of any covered major illness.
