Hi, This is Thomas and Welcome back!
Better mindset Better Life
Today I want to talk about an insurance product in Canada called Critical Illness Insurance.
As the name suggested,
the product is designed to protect against severe sickness and conditions: such as Cancer, Heart attack, stroke.
I want to go through the pros and cons of this insurance product.
Why is it important to know?
How is that different compare to disability insurance?
Should I consider life insurance or Critical illness first?
CI insurance is relatively new compared to life and disability Insurance.
It was founded by Dr Marius Barnard back in 1983 in South Africa.
Dr Barnard realized while patients' survival rate was getting higher;
they were often left in serious financial difficulties as a result of treatment costs.
Since Life insurance could not pay out,
he believed that there should be a product out there to provide an immediate financial relief.
The insurance was first introduced to cover the 4 major conditions:
cancer, heart attack, stroke, and heart by pass surgery
but now it can cover up to 26 different serve sickness and conditions.
For instance: Multiple sclerosis, Parkinson or Alzheimer’s Disease.
Take Cancer for example:
Right now Cancer is the leading cause of death in Canada
and is responsible for 30% of all deaths.
An estimated of 225,000 of new cases of cancer
and 32% deaths from cancer will occur in Canada in 2020.
And the trend will be 1 in 2 Canadians is expected to develop cancer during their lifetime.
But the amazing part is,
if you were diagnosed with cancer now as opposed to getting the same diagnosis 15 years earlier, the survival rate is much better thanks to the advanced medication.
The health care system in Canada is publicly funded,
which means the majority of the medical expenses happen in the hospital has been taking care of.
What Critical illness insurance can do
is to provide a financial relief on other cost that is related to it.
Here is a list of what people use the money for.
Imagine If you were battling a severe illness,
would it reduce your stress level if you know
The Mortgage payment has been dealt with?
Your Family can also take time off?
or get a second doctor's opinion or treatment immediately.
The biggest difference between CI insurance and Disability Insurance
DI is designed for job income replacement,
therefore the cost of insurance depends on the nature of the job.
It provides in a monthly payment and most of the plans expire at age 65.
Vs CI insurance pays in a lump sum of cash
and the coverage can last til the day the insured pass away.
The cost of Ci insurance is base on the age and gender, lifestyle and family history
For a coverage of $100,000,
the cost for a 30 year old healthy non smoker Canadian will start around 40 dollars per month. And there is choice of getting a coverage for a set interval
such as for next 5, 10 or 20 years or longer time frames to age 75 or 100.
There are other side benefits such as premium refund and waiver of premium in case of disability
The great thing about critical illness insurance is to help the insured to gain options and independence
it covers what life insurance or disability insurance cannot do.
And unlike auto insurance, the plan is guaranteed premium in Canada.
Once the contract is binded, the insurance company cannot adjust the premium for any future changes.
Two very important things and it applies to all Critical Illness Insurance.
There is a survival period for certain conditions such as strokes and heart related condition.
The survival period means you need to be alive for at least 30 days
since the diagnosis was made before the policy can pay out.
Also, for cancer coverage,
no investigations or diagnose of cancer within the first 90 days of the effective date of the insurance.
Therefore, it is very important, when there is a change or upgrade of the ci plans,
make sure that 3 months is well covered
The rule of thumb of rather should you own a critical illness insurance is,
first ask yourself do you need it,
how much coverage do you need,
then decide on which type of ci plans fits in the budget.
Please talk to your insurance advisors to plan accordingly.
I want to raise the awareness of having adequate protections.
I know lot of people will have life insurance but not enough protection for illness and disability.
I still see countless Go Fund Me cases in the past years.
One thing I know for sure when the stress goes down,
the chances you beat cancer, heart attack, stroke will be much higher
Thanks so much for staying with me! Comment below if you agree with me or not!
This is Thomas.
And I will see you in the next videos!