What Is Critical Illness Insurance and Is It Worth Buying?

You should consider your options before paying for a critical illness insurance plan. 

While a regular health insurance plan usually offers comprehensive coverage for all types of illnesses, many plans have high deductibles and copays that require policyholders to pay a lot of money out of pocket. Critical illness insurance allows you to buy insurance to cover that gap if you have a serious health diagnosis, such as cancer or a heart attack. Critical illness insurance can also cover non-medical expenses, such as mortgage or child-care bills. 

Premiums for critical illness policies are relatively low, which makes the coverage appealing. The policies usually pay out in a lump sum, with the amount depending on the policy purchased. There are different types of critical illness insurance policies: some cover only one illness, like cancer, while others offer coverage of a number of different illnesses. The more coverage offered, the higher the premiums. 

Before purchasing one of these policies, however, you need to consider the downsides. Reading the fine print on the policy is very important because the policy will only cover certain illnesses, and actual coverage may depend on the severity of those illnesses. For example, even though the policy says it covers cancer, it may only cover aggressive cancer and not a more slow-moving cancer. In addition, critical illness insurance doesn’t offer the same protections that regular health insurance offers under the Affordable Care Act, so you can be denied coverage if you have a pre-existing condition. Critical illness insurance premiums also tend to rise as you get older, and you could be denied coverage once you reach a certain age. 

Instead of critical illness insurance, you can consider alternatives. First. you should look at your health insurance to see exactly what it will cover. In addition, a health savings plan in which you contribute pre-tax dollars can be a good way to cover unexpected medical expenses. Disability insurance can also offer protection for lost salary due to illness. 

For more information about critical illness insurance, click here.

The attorneys at Elville and Associates are here to guide your family and you through your estate planning, be it updating outdated documents or beginning your first estate plan, through a crisis situation or hopefully a non-crisis situation.  Creating solutions for our clients’ needs through education and counseling using the very best legal-technical knowledge available is part of the practical mission of Elville and Associates.  Along with taking part in an accredited Client Care Program, establishing your will or trust, powers of attorney, and advance directive can offer significant peace of mind in these uncertain times.  

Contact our office today at 443-393-7696, or email Community Relations Director Jeff Stauffer at jeff@elvilleassociates.com, or Managing Principal and Lead Attorney Stephen Elville at steve@elvilleassociates.com to get started today.  We look forward to being a resource to you.


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