Critical Illness (CI) is a relatively new coverage in Canada that usually pays from $10,000 up to $1,000,000 or more if you are stricken by a critical illness such as a cancer or a heart attack. The maximum coverage amount varies depending upon the insurance company issuing the plan.
There are several types of plans available, each with slightly different definitions of what they cover. The contract definitions can be locked in for the lifetime of the contract. The cost may be locked in as level for ten years, to age 75 or even to age 100. Some even allow the plan to be ‘paid up at age 65’ and still give continuing coverage to age 75.
Critical Illness Insurance is NOT paid on the diagnosis of death. It is NOT paid on the diagnosis of a disability. It IS paid (only) on the diagnosis of a covered critical illness.
You must survive a critical illness for a fixed period of time to receive the coverage amount, usually 30 days. In other words, if you suffered a heart attack, you must live at least that long to receive this payment. However, should you not survive the 30 days, most companies will refund premiums your your estate. Most companies also offer a Return of Premium rider, for an additional premium.
Unlike life insurance, CI does not pay the lump sum to a beneficiary. The money is only paid to you. You do not receive the coverage amount as a monthly benefit. Instead, you receive one payment, in full, as a lump sum amount. The monies paid to YOU can be used anyway you wish. Whether you return to work or not is your choice. Whether you seek medical advice elsewhere or take a sabbatical from work, pay off all your creditors, or retire, the money and choices are yours.
Over the past 10-years, more than 90% of all covered claims have resulted from Heart Attack, Stroke and Life Threatening Cancer.
Some companies cover 18 illnesses, some as many as 25. Alzheimer’s Disease, Aortic Surgery, Benign Brain Tumor, Blindness, Coma, Coronary Artery Bypass, Deafness, Dismemberment, Heart Valve Replacement, Kidney Failure, Loss of Independence, Loss of Limbs, Loss of Speech, Major Organ Failure &/or Transplant, Motor Neuron Disease (ALS or Lou Gehrig’s Disease), Multiple Sclerosis (MS), Occupational HIV Infection, Paralysis, Parkinson’s Disease, and Severe Burns are examples of other covered illnesses.
This coverage is unlike any other. Government health plans and group insurance benefits are limited to basic medical and hospital care in Canada. Disability income coverage pays a monthly income only if you can’t work — if you contract multiple sclerosis and can work, CI still pays. Serious illnesses change peoples’ lives forever, CI provides the financial resources to let them face their new challenges