Should I buy Critical Illness Cover with my policy?
This Rider/ Cover on financial front in case of critical illness. One should always buy a critical illness cover even after buying a health insurance policy
Insurance industry is continuously evolving.
New features / products are getting introduced each year. One of such feature is Critical Illness cover
in Life Insurance. Critical Illness cover is one of the riders available with new
age Life Insurance policies. Please read our article on various types of
insurance and riders here. (http://www.growwealthadvisors.com/2018/06/how-to-customise-your-life-insurance.html) This rider
is a long-term insurance cover which covers serious illnesses as listed within
a policy. Common illnesses include heart attack, stroke, cancer, kidney
failure, paralysis among others. If you get one of these illnesses, a payout
would be made towards policyholder. This would be a tax-free and one-off /
staggered payment. This money would come handy to pay off bills for treatment
expensed, hospital expenses, rents (in case of long leaves without pay) etc. Unlike
a traditional health insurance policy, where the insured makes a claim based on
the actual expenses incurred on a hospitalisation, the critical illness cover
pays a lumpsum amount to the insured person on the diagnosis of a critical
illness covered in the policy. This feature makes
Critical Illness Rider unique from Health Insurance plan
Life expectancy in India is reach above 75
years in coming years. Female Life expectancy would be even more. On the
other hand, non-communicable diseases like cancers, cardiovascular diseases,
chronic respiratory diseases, and diabetes, are the emerging as “main killers”
in India - These four diseases alone account for 60 per cent of total
deaths in India. The country's disease burden is only expected to increase,
significantly so, as the incidence of heart disease and diabetes is projected
to double, and cancer cases are expected to increase by 25 per cent. One of the
World Health Organization (WHO) report have projected that there is that there
is a 26 per cent probability that a person between 30 and 70 years could die of
above mentioned non-communicable diseases in India.
What about cost?
Lets
understand this using an example.
To
give an idea, let’s consider example of LIC’s Jeevan Shiromani Plan. This plan
is designed for High Net Worth Individuals who has high Sum Assured
requirements and yet plan to pay only for limited period. Let’s take example of
Mr. A who has taken Cover for Rs 1 Crore for 20 years. In this plan premium
paying term is 16 years only with premium holiday for last 4 years. In this
case premium comes to be Rs 6.93 Lacs (+GST). Now consider that if Mr. A wants
to take Critical Illness (CI) ride for 25 Lacs (1/4th of basic SA). In
this case, premium required will be Rs 7.02 Lacs only which is only 9000 more
even if CI cover is 25% of basic SA. Which means Mr. A can improve his cover by
25% by paying only 1% more premium.
In brief factors that will affect premiums are
1. smoker / Non smoker
2. health (your current health, your weight, your
family medical history)
3. job (some occupations carry a higher risk)
Reasons to buy Critical Illness Rider .
1. Acts as an income replacement
2. Policyholder gets much more cover for modest increase in premiums
3. Dual tax Benefits
4. Dual benefits that will cover medical & day-to-day expenses
Please contact us at 9325295502 to know more or for insuring yourselves/ your loved ones
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