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Critical Illness Insurance: Be Prepared for Everything that Comes Down the Road

Written by waploaded

A critical illness insurance plan allows the policyholder to get a lump sum amount if diagnosed with a critical illness. It can cover both hospitalization and non-hospitalization expenses and provide you with much-needed cash flow while recovering.

However, many people wonder why they need a critical illness insurance plan when they already have a comprehensive health insurance plan. There are times when your regular health plan may not be able to cover all your treatment and related expenses if you happen to be diagnosed with a critical illness, such as cancer, or you would need a major organ transplant in the future.


Why Should I Bother to Purchase a Critical Illness Insurance Plan?

According to the Friends Provident International report, around 4,500 cases of cancer are diagnosed every year in the UAE. What’s more alarming is that the average age of people suffering a heart attack in the UAE is 45 compared to 65 globally.

Thus, rather than going with the “it won’t happen to me” mentality, you should start looking for ways that will help you prepare for a better future with more financial stability no matter what comes down the road in terms of your health.

Do you want to know how much critical illness insurance cover you will need? If yes, you can get a rough idea of the required sum assured by using an essential illness insurance calculator.


How does a Critical Illness Insurance Plan different from Regular Health Insurance Plans?

When you have a critical illness insurance plan, the insurance company will pay you the Sum Assured if you are diagnosed with a critical illness covered in your project. For instance, if the Sum Assured under the plan is AED 500,000, you will get AED 500,000 at once on the critical illness diagnosis. The amount is paid whether you choose to get the treatment or not. You have complete freedom to use that amount as you wish.

A Critical Illness Insurance Plan is renewable for a lifetime; however, as soon as you are diagnosed with a critical illness and paid the Sum Assured by the insurance company, the policy gets terminated.

On the other hand, regular health insurance plans, which are just indemnity products, compensate only to the extent of actual expenses incurred up to the ceiling of the Sum Insured. For instance, if your Sum Insured is AED 500,000 and your hospitalization bill is AED 100,000, the insurance company will pay only AED 100,000, and the policy continues.

Additionally, health insurance plans are renewable plans, i.e., based on the previous year’s claims, and the insurance company can decide how much premium to charge you. If you are diagnosed with a critical illness requiring multiple years of treatment, in most likelihood, your medical insurance premium will skyrocket at the time of renewal.

These are why critical illness insurance plans are distinct from regular health insurance plans.