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Life Insurance with Critical Illness Cover

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Term life insurance with critical illness cover offers an incredible solution to individuals seeking comprehensive financial protection against life's uncertainties. This unique insurance product combines the benefits of term life insurance, which provides financial security to loved ones in the event of the policyholder's death, with critical illness coverage that offers financial support upon diagnosis of a covered illness.

In this article, we will dive deeper into term life insurance with critical illness cover, exploring its key features, benefits, and considerations. Let’s find out how this type of policy provides a crucial safety net not only for the policyholder's loved ones in the event of their passing but also for the policyholder themselves in case of a severe illness.

An Overview of Term Life Insurance Critical Illness Cover

Critical illness, one of the most sought-after riders, enables the policyholder to get financial assistance in case they are diagnosed with critical illness during the policy tenure. Critical illness can be defined as any life-threatening disease like stroke, cancer, kidney failure, and more that needs intensive medical treatment.

On buying a term life insurance plan with critical illness cover, you can file a claim up to the sum assured amount if diagnosed with any disease mentioned under the benefit.

The critical illness benefit rider financially protects the policyholder and their family as they receive a lump sum amount upon diagnosis of the disease. The amount that they receive can be used to cover the treatment expenses.

Disease Covered Under Term Life Insurance with Critical Illness Rider

Here are the common illnesses covered under term life insurance with critical illness cover -

Angioplasty Blindness
Myocardial infarction Open chest CABG
Muscular dystrophy End-stage liver failure
Poliomyelitis Medullary cystic disease
Primary pulmonary hypertension Benign brain tumour
Multiple sclerosis with persisting symptoms Third-degree burns
Deafness Kidney failure that requires regular dialysis
Heart valve surgery Cancer of specific severity
Major head trauma Major organ/ bone marrow transplant
Motor neuron disease with permanent symptoms Aplastic anaemia
Permanent limb paralysis Primary pulmonary hypertension
End-stage lung failure Loss of limbs
Systemic Lupus Eryth with Renal Involvement Loss of independent existence
Parkinson’s disease Aorta graft surgery
Coronary artery bypass Heart attacks
Strokes -

How Does Term Life Insurance with Critical Illness Cover Work?

With the term life insurance critical illness rider, a predetermined lump sum is granted to the insured upon the diagnosis of a critical illness as specified in the policy. However, it is crucial to thoroughly review the coverage details before selecting this rider, as the policy terms and conditions dictate whether the coverage for critical illness persists or terminates.

Several insurance companies are introducing inventive critical illness riders that encompass lifestyle diseases. In addition to this, the insured can avail themselves of advantages related to both hospitalisation and non-hospitalisation expenses.

Benefits Offered under Term Life Insurance with Critical Illness Rider

Discussed below are the benefits of term life insurance with critical illness cover in detail -

1.) Makes up for the Lost Income

When the primary breadwinner in a family gets diagnosed with a severe illness that prevents them from working and earning, the burden on both the patient and their family can become overwhelming. 

As the policyholder and provider for your family, it is important to prepare for such unforeseen circumstances. Instead of your loved ones struggling to cover your medical expenses while managing household finances, it is essential to have a safety net in place.

The term life insurance critical illness cover serves as a form of income replacement, granting your family the necessary time to arrange the matters while you concentrate on your recovery. By opting for this rider, you can alleviate the financial strain and allow your family to focus on providing the care and support that you need during this challenging period.

2.) Covers Expensive Medical Treatments

In situations where individuals lack the necessary funds for medical expenses, they are often compelled to borrow or accumulate debts. Unfortunately, many are left with no choice but to abandon treatment due to their inability to afford it.

By opting for a term life insurance critical illness cover, however, you can easily avoid such circumstances and ensure comprehensive protection for your health and financial well-being.

3.) No Changes in the Premium Amount

The premium amount for the term insurance with critical illness cover remains fixed even if the policyholder is diagnosed with a critical illness. Furthermore, if the plan provides a waiver of premium on critical illness, then the due premium will be waived. 

4.) Large Cover

The expenses associated with treating critical illnesses such as cancer, heart attacks, kidney failure, and others are considerably high. Within a short span of time, these treatment costs can drain one's financial resources.

A term life insurance plan with a critical illness rider can emerge as a saviour here, offering extensive coverage against multiple critical illnesses at an affordable additional premium. Put simply, it provides more benefits while requiring less expenditure from your pocket.

5.) Increased Survival Chances

As critical illness treatment costs soar, some individuals may find themselves unable to bear the financial burden. Regrettably, many are forced to prematurely discontinue their treatment due to insufficient funds. 

However, by incorporating a critical illness rider into your term insurance policy, you can guarantee that you will never be compelled to compromise your treatment due to financial constraints. With proper treatment, the likelihood of fatality decreases, substantially improving the policyholder's prospects of survival even in the face of a critical illness.

Exclusions Under Term Life Insurance Critical Illness Rider 

The following are the exclusions under term life insurance critical illness rider -

  • Pre-existing medical conditions
  • Participation in war, riots,  and rebellions
  • Suicide attempt or self-harm
  • Participation in criminal activities
  • Congenital infections

Who All Can Buy Critical Illness Rider?

Individuals belonging to any of the following categories can buy term life insurance with critical illness cover -

  • Sole Breadwinners - If you are the main source of income for your family, you should consider opting for term life insurance with a critical illness rider. Not only can this provide assistance to you during periods when you are unable to work, but it also offers valuable support to your dependents.
  • If There is a Family Medical History - If a senior member in the family has a history of disease like cancer, coronary heart disease, etc., it is suggested to buy a critical illness rider. 
  • People Over the Age of 40 Years - Health vulnerability generally tends to develop rapidly once you turn 40 years old. In such cases, it is beneficial to opt for term life insurance with a critical illness rider. 
  • People Working Under High-pressure Jobs - Stress and an unhealthy lifestyle can undoubtedly lead to critical illness. Thus, to protect oneself in case of any such situation, a term life insurance critical illness rider is necessary. 

Eligibility Criteria to Apply for Term Life Insurance Critical Illness Cover

Check out the general eligibility criteria to apply for term life insurance critical cover -

  • Age to Apply for Term Life Insurance Critical Illness Cover: Minimum Age - 18 years; Maximum Age - 65 years
  • Maturity Age: 75 years

Things to Consider When Buying a Term Life Insurance with Critical Illness Cover

Keep in mind the following factors when planning to buy a term life insurance critical illness rider -

1.) Increasing Age

With advancing age, health conditions become more delicate, raising the likelihood of encountering critical illnesses such as heart stroke, diabetes, paralysis, and more. Additionally, the medical expenses associated with treating these illnesses far exceed those of regular treatments. 

Thus, it is prudent to be proactive and obtain insurance coverage to safeguard your financial well-being against such uncertainties. If you are a senior citizen or have a senior citizen in your family, opting for a term life insurance critical illness rider is advisable by experts as it can serve as a proactive measure to ensure comprehensive protection.

2.) Current Medical Conditions

In the fast-paced world we live in, the demands of a hectic lifestyle and work-related stress can potentially pave the way for daunting diseases in the future. Individuals operating within high-pressure environments are strongly encouraged to consider obtaining a policy to ensure financial stability and security.

When opting for term life insurance critical illness rider, it is crucial to take into account your current health status and lifestyle as key determining factors. Furthermore, if your family has a medical history associated with critical illnesses, it is highly advisable to proactively secure yourself with critical illness insurance at an early stage. By recognising the importance of these factors, you can fortify your defences and protect your well-being against the uncertainties of life.

3.) Future Medical Expenses

Given their current income, numerous individuals hold the belief that they can manage medical expenses should an unforeseen health crisis arise. However, with healthcare costs being on a rapid incline, it becomes necessary to do a thoughtful evaluation of one's future financial situation and the potential impact on their lifestyle when acquiring insurance of any kind.

Critical illness cover provides extensive coverage against severe illnesses at a reasonable premium, making it wise to opt for term life insurance with critical illness cover not only for oneself but also for loved ones.

By doing so, you can ensure maximum protection against critical ailments while maintaining financial stability. It is prudent to consider the long-term implications and make an informed decision that safeguards your well-being and that of your closest family members.

4.) Policy Premium

Term life insurance critical illness cover is affordable. However, the specific premium amounts can vary among insurance companies. Consequently, it is advisable to compare and examine the premiums offered by different insurance providers. This way, you can ensure that you obtain the highest level of coverage while paying the lowest possible premium.

5.) Exclusions, Exemptions, and Terms and Conditions

Before choosing the critical illness rider for term life insurance, it’s essential to carefully review the policy's list of exclusions, exemptions, and terms & conditions. If you seek financial protection for a particular critical illness, make sure that the insurance provider covers it by examining the list of covered critical illnesses in the policy. Take time to read all the policy documents in advance so that you can avoid potential disputes down the road.

6.) Insurance Provider

When selecting an insurance provider, it is crucial to assess whether their claim settlement process is hassle-free, efficient, and customer-oriented. Additionally, consider the responsiveness of their customer service and ensure that your preferred hospitals are included in their network.

Equally important is the reputation of the insurance company within the market. Luckily, all this vital information is readily available online, including the opportunity to read reviews from actual customers.

Let’s see what people are asking about term life insurance with critical illness cover in the FAQ section next:

Frequently Asked Questions

Q1. Does term life insurance critical illness rider cover all critical illnesses?

Ans: Critical illness insurance plans provide coverage for a wide range of major illnesses. However, the specific exclusions within this category may differ between insurance providers. We recommend carefully reviewing the policy document to obtain detailed information on the exclusions applicable to your specific plan.

Q2. Should you opt for a critical illness rider with term life insurance?

Ans: When purchasing a term life insurance policy, it becomes essential to include a critical illness rider. This rider offers additional financial support during unexpected medical emergencies. Given the unforeseen nature of critical illnesses, having a rider in place proves invaluable during dire situations.

Q3. How can you calculate critical illness cover?

Ans: When determining the appropriate amount of critical illness cover to purchase, a widely used method involves the following steps: Start by calculating your monthly household expenses and determine the financial gap that would arise if you were unable to work.

Next, multiply this shortfall by the duration for which you desire to receive support in the event of a critical illness, be it a specific number of months or years. This calculation will assist in determining the ideal level of coverage needed to provide adequate protection during such challenging circumstances.

Q4. What is the waiting period under term life insurance critical illness cover?

Ans: The waiting period for term life insurance critical illness cover is usually 90 days.

Q5. How does term life insurance critical illness cover work?

Ans: Critical illness rider provides a lump-sum benefit upon the diagnosis of a covered condition. Once diagnosed, the individual covered by the policy, whether it's you or one of your family members, can submit a claim for the benefits. Subsequently, the claimed amount is directly disbursed to the covered individual.

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