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critical illness insurance

Do I need a Critical Illness Insurance Plan?

It’s estimated in 2021 Canada had over 225,000 Canadians  diagnosed with Cancer while an estimated 2 in 5 Canadians will develop Cancer.

Another 1.3 million of Canadians are living with Heart Disease.

Critical Illness Insurance is a living benefit policy that provides a lump sum payout  if diagnosed with a serious illness.

It is designed to offset this unexpected hardship on a family.

What costs arise when diagnosed with a Critical Illness?

  • Having to pay for medical coverage outside of the Provincial health plan or group benefit plan
  • Reducing your hours at your work
  • Set aside funds for things such as paying a mortgage or  university savings
  • Renovations to the home to accommodate and make accessible
  • Drugs / Vaccines not covered by a Provincial Health Plan
  • Homecare and Nursing support

The need for critical illness insurance continues to be an important part of Canadians financial plan. A medical condition such as the ones covered in a critical illness policy can have a catastrophic effect on a household.

Not having a Critical Illness plan can:

             Cause an Individual to Dip into Savings thus forcing them to Retire later in life

             Cause a person to have to sell their home due to being unable to work

             Cause them to not meet financial obligations such as credit cards, children education funds

Simple Issue Critical Illness – Non Medical Application

Many Insurance companies recently in order to make coverage accessible and affordable for Canadians have introduced Simple Issue Policies.

The policy requires a medical declaration and has the following features:

  • Provides coverage with a few questions and payment.
  • The coverage will be for 5 of the major critical illness conditions
  • It’s an affordable path to protect yourself.
  • The conditions covered consist of Cancer, Heart Attack, Stroke,Coronary Artery Bypass Surgery and Aortic Surgery.
  • Tax free funds Payout
  • Return of Premium available
  • No height and weight requirements
  • No family history required

Critical Illness Full Coverage

The application will require more details about your medical history, family history and a Paramedical will be needed.

This policy features:

  • Coverage of up to 26 serious medical conditions
  • Add ons such as Return of Premium available
  • Variety of Options: Term 10, Term 20, Term to age 75, Permanent coverage can be purchased
  • Issue ages 18-60

Covered Illnesses:

  • Aortic surgery
  • Aplastic anemia
  • Bacterial meningitis
  • Benign brain tumour
  • Blindness
  • Cancer (life threatening)
  • Coma
  • Coronary artery bypass surgery
  • Deafness
  • Dementia, including Alzheimer’s disease
  • Heart attack
  • Heart valve replacement or repair
  • Kidney failure
  • Loss of limbs
  • Loss of speech
  • Major organ failure (on waiting list)
  • Major organ transplant
  • Motor neuron disease
  • Multiple sclerosis
  • Occupational HIV infection
  • Paralysis
  • Parkinson’s disease and specified atypical parkinsonian disorders
  • Severe burns
  • Stroke

Can you get Critical Illness insurance after Cancer? Heart Attack? or Any other Critical Illness Diagnosis?

This is dependant on the insurers moratorium period and what exclusions are put in place. We would suggest a simplified policy in a majority of cases.

Is Critical Illness Insurance Needed / Worth it?

Critical illness Insurance – Pros and Cons

It’s sensible to weigh the value of any product you may want to add to your Financial Portfolio. Critical Illness pays out when other policies may not such as Disability Insurance or Life Insurance. The money is received tax free and can be used however you see fit. The policy can be designed to have a return of premium so if you don’t use it, you won’t lose the money you paid into the policy.

What if I just put the amount I would’ve spent on a Critical Illness Insurance  premium into a Secured investment?

A secured investment such as a Segregated fund may already be prioritized for things such as your retirement fund. Critical illness can act as a way to protect you from cashing out things like an RRSP or GIC. Since these investments may also carry Penalties, tax implications etc. you may not end up with what you put into it.

Critical Illness is an effective way to protect yourself and family should you be diagnosed with a major illness. Contact us today for a free no obligation quote and we can put together the plan that’s right for you.

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Post Author: CHC