According to the National Institute of Cancer Prevention and Research, since 2012 there has been a 15.7% rise in the number of cancer cases in India. Furthermore, Health care costs have also increased significantly owing to inflation. In this sense, it may be time for you to consider adding a critical illness rider to your existing health insurance plan. 

1.How is critical illness insurance different from health insurance? 

Health insurance is a broad category of insurance policies that cover medical and surgical expenses incurred by the insured party. On the other hand, critical illness plan pays a fixed amount to the policyholder if they acquire a serious ailment such as cancer, a stroke, heart attack, renal failure or other similar conditions. While a health insurance policy provides for medical expenses incurred, a critical illness policy provides a lump sum on the diagnosis of the illnesses.  

2.Why is a critical illness plan necessary? 

In the event that you incur one of the illnesses mentioned above, your treatment can mount up quite a bill. The hospital expenses covered by the health insurance are restrictive and limit the out of hospital expenses. Critical illness plans cover a gamut of hospital expenses which also include out of hospital expenses with sudden and extended lifestyle changes, in some cases impact regular income. Having a critical illness policy can protect your finances during this time. 

3.How much is a critical illness plan going to cost? 

Some of the most common critical illness plans in India are: Fuure Generali Life Insurance Heart and Health Insurance Plan which covers 59 critical illnesses; Apollo Munich Health Insurance Optima Vital that covers 37 critical illnesses; and Max Bupa Health Assurance Criticare which covers 20 critical illnesses. The premium for a non-smoking healthy male of 35 and a cover of INR 10 lakh cover would mostly range between INR 5000 and INR 7000 per annum. Some policies cover post-hospitalisation expenses as well. This could range from 60 days and extend up to 180 days in some cases. In a time when several non-communicable and other harmful hereditary diseases are prevalent, having a critical illness plan could be your saving grace.

4.Who should choose critical illness insurance? 

Critical illness insurance is most suitable for individuals moving into their forties, or even earlier if their financial plan can make the accommodation. Since your risk of contracting one of these ailments is increased during this period, getting a critical illness policy sooner can ensure that you qualify to buy a policy easier. A critical illness insurance plan offers you a means to secure your finances at a time of uncertainty. Investing in a critical illness plan becomes extremely important if you have a genetic predisposition for a particular illness. 

5.What are the drawbacks of buying a critical illness plan? 

Adding a critical illness rider/policy also comes with certain limitations. If you do have a genetic predisposition to one particular condition or more, your premiums can become quite high. Similarly, the more number of illnesses you want to be covered for, the more you will have to pay in premiums. Since no one can predict an ailment, you may end up paying hefty premiums to feel secure. 

Having considered these points, a critical illness plan should only be taken in addition to an existing health insurance plan. With the limitation in the number of illnesses covered, it does not ensure your overall coverage towards medical expenses. However, the particulars of your critical illness policy may vary as per your unique requirements. In saying that, contacting a certified financial planner or wealth management firm can help you figure out if you need to get critical illness insurance, and if so how much. They have the relevant knowledge and expertise in these processes to help you make the right choice.