You might debate that as you are covered in a comprehensive health insurance plan and also under group medical policy offered by your employer, you do not require any additional coverage. Well, yes, but any critical illness calls for specialized treatment & care and as your comprehensive health plan has limitations on hospitalization, doctors’ fees, etc. it will not cover the entire medical expense towards treatment.
In simpler terms, there is a limit on certain expenses like prosthetic, intensive care or even medicines and your spending on such ailments is always more than what your health insurer will pay. In such cases, you’ll have no option but you’ll end up paying from your own pocket.
Examples of Critical Illnesses:
- Heart attack
- Stroke
- Major Organ Transplantations
- Kidney failure
- Paralysis
Note: You can claim only once on your Critical Illness insurance policy and then it stands terminated.
Features & Benefits of Critical Illness Insurance
Features of Critical Illness Insurance
The key features of critical illness insurance are:
- Provides cover ranging from a minimum of Rs. 1 lakh
- 30 day grace period is applicable
- Sum assured is paid as lump sum
- Medical screening is required if the policyholder is above the age of 45 years
- Day care procedures (less than 24 hours) are covered
- Pre-existing diseases are not covered
- Cashless facility is available
Benefits of Critical Illness Insurance
The key benefits of critical illness insurance are:
- Coverage is provided for up to 36 life threatening diseases
- Convenient, fast, hassle-free claims process
- The sum assured provided is in the form of lump sum payment which can be used as an income replacement
- 100% benefit payout upon diagnosis of terminal illness
- Provides accidental death benefit
- Protection against disability
Tax Benefits under Critical Health Insurance
The premium paid towards a critical health insurance plan is eligible for tax deductions under Section 80D of the Income Tax Act, 1961. You can enjoy tax-savings of up to Rs. 25,000. Senior citizens can enjoy tax-savings of up to Rs. 50,000. In the case of your parents are senior citizens, you would be eligible to receive tax deduction of Rs. 50,000 on the premiums paid for them.
Importance of Critical Illness Insurance
Any major sickness or illness can have a debilitating effect on the patient’s life. It leads to huge medical treatment costs and the same time leaves the family members shattered both emotionally as well as financially. At such circumstances, a Critical Illness Insurance comes as a real saviour, guaranteeing financial protection whenever there is shortage of funds for getting the patient treated. Here, the insurance company offers an amount in lump sum in case the insured gets diagnosed with any of the critical illnesses mentioned in the policy document. Covering the medical costs of the patient as well as the day-to-day expenses of the family members would be taken care by the Critical Illness Insurance Plan.