Critical Illness & Disability Insurance
Is Critical Illness Insurance… Critical?
It is a relatively new insurance product which helps to protect your financial security should you be diagnoses with an illness or disease.
The diagnosis of a serious life altering or life threatening disease can be devastating to our lives on many levels – emotionally, physically and financially. A Critical Illness policy is purchased with the intent to help alleviate some of the potentially devastating effects of a serious diagnosis or event. A Critical Illness Insurance policy provides a tax free lump sum benefit for you to spend how you need to get through this hard time, such as private nursing, out of country medical aid, debt payment or a lifelong dream holiday. Each company varies on the covered conditions provided by their policies but the generally the standard covered illnesses are listed below.
The lump sum benefit just 30 days after the diagnosis of one of the following critical illnesses:
- Loss of Speech
- Major Organ Transplant
- Motor Neuron Disease (ALS or Lou Gehrigs Disease)
- Coronary Artery Bypass Surgery
- Multiple Sclerosis
- Heart Attack
- Kidney Failure
- Severe Burns
- Loss of Limbs
- Life Threatening Cancer
- Occupational HIV
There are many options in terms of how a policy is structured such as a policy which is in place for 10 years, 20 years or level premium until the age of 75 and also paid up options. As with life insurance; Critical Illness coverage is the least expensive when we are healthy and young.
This type of insurance is quite often overlooked and misunderstood. It could be the most important policy you ever buy to protect your family from the financial devastation of a family member (income earner) not being able to work in the same capacity due to a disability. The purpose of Disability Insurance is to put close to the same amount of disposable income into insured’s hands that he/she was earning prior to becoming disabled.
Many employers provide some form of disability to their employees but often it is with limitations. It is important to know what the limitations are in your own employer provided plan and if it be enough to help you recover both physically and financially.
Usually disability policies are built based on a monthly benefit and is calculated by your pre-tax income. The policy is underwritten using your occupation class, smoking status, age and overall health and lifestyle.
If you would like more information on how you can protect your pay cheque should something happen to you and you are no longer able to work or work in the same capacity please contact our office.