With various medical breakthroughs, our lives moved higher and into better levels. Life span now has been added with extra 10-15 years thanks to the various medical discoveries prolonging life itself. This reality however has a disadvantage precisely when one’s life has been retained and the person needs more than the budget’s medical attentions.
Are you then surprised? Most often than not, in case of death of a person, the expenses are for the remaining family only. But in case a person survives say, a massive heart attack or paralysis, the expenses zoom. This includes the day-to-day expenses of the family as well as the medical expenses of the patient, which can be very high. Then there is therefore a need to exercise being practical.
It is interesting to note that the hospitalization expenses can obviously be taken care of by the mediclaim policy bought by the insured, but in case of critical illnesses like the above, the costs after hospitalization could also be huge. What then shall you do in this regard?
Well, not only that, the cost of medicines and diagnostic tests 60 days after hospitalization is normally not included in mediclaim policies. Sometimes, these costs can be high enough to make a huge damage to finances. Also, the income normally stops or is significantly reduced when the main wage earner is affected. Thus it is a double whammy of troubles. But there is no reason to loss hope nor give up.
In addition, in a recent article, we read that India may soon become the heart attack capital of the world. What was also stated is that with major improvements in medical infrastructure, most of us will survive the heart attack. It is to address the needs of such a person that critical illness policy is required. This pays you lumpsum money if you contract the specified critical illnesses such as organ failure, stroke, paralytic attack, multiple sclerosis, etc. At least this would be a relieve.
Moreover, you must take note that, this lumpsum enables you to earn income by investing it in any appropriate instrument so that interest from it can act as a substitute to the income lost due to the illness. That is why such policies are part of what are broadly known as income-protection plans. Typically, your critical illness cover should be at least as much as your life insurance cover.
Hence, a critical illness policy can be bought in two forms — either as a rider to a life insurance plan or a standalone policy from a general insurance company.
Now what is a rider? Well, a rider is anything bought along with a normal life insurance plan, on payment of extra premium. This is the best way of getting critical illness cover if you are also simultaneously buying term cover, as the premium for the rider normally remains constant over the tenure of the policy. However, depending on your case, you may or may not be able to buy adequate cover in this manner.
Obviously, that’s because guidelines restrict the premium payable on such a rider to maximum 100% of the base term insurance premium (30% of the base premium if you are buying the rider on top of a traditional policy or Ulip). As critical illness cover is expensive, this results in the rider being for a fraction of the sum assured. This can result in inadequate coverage. If this will eventually happen, the patient or victim and his or her family will definitely be in critical condition, financially wise.
Furthermore, you need to buy the rider at the time you buy the term policy, since no life insurance company allows riders to be attached in later years. Thus, if you have already bought a life insurance policy, or find that the rider does not provide adequate coverage, you will have to buy a standalone critical illness policy. These are yearly policies, and need to be renewed every year. This will make the difference therefore.
Finally, perhaps, if the guideline restricting the rider premium to 100% of the base term insurance premium is relaxed, some life insurers may start offering critical illness riders for higher amounts as well. This will help all cover yourself appropriately in case of a critical illness strikes.
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In conclusion, each and every individual person in the family should therefore be insured with any of the various life insurance policy because of the obvious fact that in the future insurance policies will definitely serve well most especially in moments of emergencies. This should teach a lesson to each and every family who do not give enough priority in view of getting a life insurance while it is still early. Thus, let us not waste time before it’s too late.
