Critical Illness

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Critical illnesses include ailments like heart disease, cancer, organ failure, major organ transplant, kidney disease, coma, stroke, etc. These illnesses affect your day-to-day life for an extended period of time and are also quite expensive to treat. Purchasing a critical illness policy will ensure that if you are ever diagnosed with a critical illness, one that meets the insurer’s criteria, you will receive a lump sum payout from the insurer. There are no restrictions on how one can utilize this amount. You can use the funds to take care of the immediate financial needs of your family, cover hospitalization expenses and recovery costs, plan for a lifestyle change, or can also serve as an income replacement.

How Critical Illness Health Insurance Plans Work?

To demonstrate how critical illness health insurance plans work, let’s take the example of Rajesh, who purchases a critical illness cover for himself for a sum insured of Rs.5 lakh. He pays the due premiums and renews the policy every year. During one such policy term, Rajesh suffers from a critical illness which causes him to be hospitalized for a few days. Rajesh’s total hospitalisation bills have come up to Rs.4 lakh. Rajesh receives a lump sum payout from the insurer after the 30-day survival period. He utilizes this amount to pay for his post-hospitalisation expenses and as an income replacement for the months that he does not work. The critical illness policy enabled Rajesh to get back on his feet smoothly, and not worry about his liabilities.