What is critical illness insurance?
Critical illness insurance coverage can provide a one-time, tax-free lump sum payment if you’re diagnosed with a serious condition. Your policy will specify the conditions and requirements of your insurance coverage, but some examples include many kinds of cancer, heart attack and stroke.
The risk of getting a critical illness
Your personal risk of getting a critical illness will depend on your:
- Age – Older people are more likely to be diagnosed with a critical illness. The risk of many illnesses peaks earlier for biological men than for women.
- Lifestyle and health – If you smoke or are obese you may be more likely to be diagnosed with a critical illness. Conversely, if you exercise and eat a healthy diet, you may be less likely to get a critical illness.
- Medical history – If you have a condition such as diabetes or you have a family history of cancer or heart disease, you may have a greater risk of being diagnosed with a critical illness.
- Genetics – Genetic variations often inherited by a parent will mean some people may be more likely to get some diseases due to their genetic make-up.
The costs of critical illness insurance
Those faced with a critical illness may have additional expenses not covered by provincial health insurance or workplace health benefits, such as:
- Lost income (because you need to take time off work)
- Prescription drugs
- Medical equipment (special bed, walker, etc.) for your recovery
- Caregivers
- Travel and accommodations
- Increased childcare costs
You can use your critical illness payment to help take care of any of these expenses. You can also use it to help protect your retirement savings, cover day-to-day expenses, or even pay for a bucket list experience.
Is critical illness insurance worth it?
Critical illness insurance offers a different type of financial security than life insurance or disability insurance.
If you’re concerned how your life may be impacted if you got seriously ill, how your family’s financial well-being may change or how having to work through your illness may delay your recovery, critical illness insurance is worth looking into.