Accident & Health Insurance
Is Critical Illness Insurance Worth It?
Heart disease, cancer, diabetes, and other chronic diseases — defined as conditions that last a year or more — are the leading causes of disability and death in the U.S.1
A major medical condition can have a far-reaching financial impact on you and your loved ones. Beyond the cost of medication, treatment and hospitalization, regular expenses — like housing, groceries, and childcare — can also add up during illness.
Coping with financial stress can make it difficult to focus on your recovery, as it can potentially deplete any savings safety net you’ve worked hard to build.
If you or your spouse were to get a serious illness, could you cover out-of-pocket costs, experimental treatments, childcare, and other daily expenses that may not be covered by your medical insurance? Research revealed that 1 in 12 adults have medical debt, with 6% or 14 million of them owing more than $1,000, and 1% or 3 million of them owing more than $10,000.2
Critical illness insurance can help protect your future by providing financial support if you have a serious illness or medical condition. It can be used to help cover costs (however you see fit) during your recovery.
What is critical illness insurance?
Critical illness insurance is a type of supplemental health insurance that typically provides a lump-sum payment, which can be used to cover planned procedures or unexpected expenses resulting from a life-threatening or life-altering diagnosis.
If you’re diagnosed with a covered critical illness, the insurance benefits can be used toward anything you see fit, from medical bills to other expenses — like childcare, groceries or a mortgage.
3 reasons to consider enrolling in critical illness insurance
Critical illness insurance can provide fundamental financial support to you or your loved ones when you need it most. Here are some of the most common advantages of having critical illness insurance.
1. It can help cover expenses that medical insurance may not
Medical insurance may only cover a portion of the expenses associated with treating a serious illness. Plus, additional costs that often come with recovering — like childcare, transportation, and grocery delivery — may be left up to you. Critical illness insurance can provide funds to help you pay for unexpected costs.
2. It pays a lump sum directly to you
One of the benefits of critical illness insurance is that it pays a lump sum directly to you for covered conditions — not to healthcare providers — for covered conditions. You can use the money on anything you need, including household expenses, medical payments, or personal needs for you and your family.
3. It covers a range of serious illnesses
Depending on your plan, critical illness insurance often provides payment for conditions like heart attacks and strokes, as well as diseases. For a full list of what your plan covers, make sure to consult your policy, as coverage can vary.
Why may critical illness insurance be a good fit?
Having critical illness insurance can bring you and your family some relief if you're faced with expenses from an illness.
Consider the following situations where purchasing critical illness insurance may be worth it:
- Your employer offers it at a low cost.
- You or a family member has a history of health issues
- You or a family member are suddenly diagnosed with a critical illness.
Do I need critical illness insurance if I have a savings account?
Having a rainy-day savings account is another way to help prepare for unexpected medical costs and serious illnesses. But according to a Bankrate study, only 44% of adults have enough in their savings to comfortably afford an emergency expense of $1,000 or more.3 Critical illness insurance may help protect your savings if you or a family member are diagnosed with a serious medical condition.
How do you get critical illness insurance?
Your job may provide employee critical illness insurance. If so, you can sign up during open enrollment (typically October – November), during a qualifying life event, or when you first start your job. For more information, reach out to your human resources representative. If you would like to purchase an individual plan, you can do so through an insurance provider.