Life is totally unpredictable & Medical Emergencies can knock at your door anytime. If you or your family member gets diagnosed with a Critical Illness, it doesn't take long to lose out on hard earned savings.
Let us consider cancer, for instance, which accounts for nearly 7% of deaths in India on an annual basis.* One of the most effective drugs for breast cancer, called Herceptin, can cost anywhere between Rs. 75,000 to up to Rs. 1 Lakh for a single vial. Patients of breast cancer generally require nearly 6 to 17 vials for treatment. Another popular drug, Avastin, needs to be taken by patients for at least 5 to 10 cycles per course, each cycle costing between Rs. 25,000 to Rs. 50,000. Given that the cost of cancer treatment essentially runs into lakhs and lakhs of rupees, an average Indian often prefers to abandon their treatment rather than paying for all the expenses.
A Term Insurance cover with a Critical Illness Rider at this stage can take care of your financial worries & allow you to focus on the treatment. In fact, industry experts particularly emphasise on the importance of adding a Critical Illness Rider to the base Sum Assured under a standard Term Insurance plan.
* The Economic Times
The Critical Illness rider has been created with the goal of protecting oneself and their families in the event that they incur huge medical bills resulting from a Critical Illness. Considering that serious medical ailments and illnesses are associated with exorbitant medical costs, often costing several Lakhs, a Term Insurance plan with the Critical Illness add-on can prove to be very helpful.
Such policies pay out a lump sum amount equivalent to Sum Assured under the rider, upon being diagnosed with a pre-specified Critical Illness.
Medical Emergencies come unannounced & in addition to emotional and mental strain, it can drain a significant portion of your lifelong savings. Critical Illness Riders ensure extra protection against these ailments. Available at nominal charges, these riders are helpful, especially if you have a medical history or fall in the high-risk category.
For your understanding, we have mentioned the reasons which signify that Critical Illness Rider should be added to your Basic Term Plan.
If you get diagnosed with one of the Critical Illnesses and lose the ability to work, the Critical Illness Rider can serve as a temporary source of income while you are undergoing treatment. These riders offer a wide range of flexibility, wherein you can utilize the funds received to serve different needs i.e. hospitalisation or non- hospitalisation.
Better Chances of Survival
With the cost of medical treatment running up to lakhs and lakhs of rupees, it is nearly impossible for an average middle-class household to cover the treatment expenses. As a result, you will often see families give up on the treatment process. Sum Assured with Critical Illness Rider allows you to get access to proper diagnosis and quality treatment, and in turn, improve your chances of survival.
Immediate Payout Post Diagnosis
A very important reason to consider opting for this rider is that you do not have to wait for the Sum Assured till after the treatment. This essentially means that you are entitled to receive the full amount assured under the rider, right after being diagnosed with the Critical Illness. This eliminates the need for you to pay out of pocket for the treatment or hospitalization expenses that you will incur as a result of it.
Protection against Medical Inflation
Medical inflation rose from 3.8% in December 2019 to 7.7% in June 2021*. This has been a growing case of concern given that nearly half of the population in India loses out on quality care as a result of it. Therefore, you should give this rider some serious consideration, more importantly if you have a family history of any of the Critical Illnesses.
* The Hindu
The premiums paid towards a Term Plan are eligible for Tax Benefits under Section 80C of the Income Tax Act, 1961. Up to Rs. 1.5 Lakhs is deductible from your taxable income with Term Insurance. Further, the benefits received are exempt under Section 10 (10D) of the Income Tax Act.
The reasons listed above are strong enough for you to seriously consider getting a Critical Illness Rider with your Term Plan.
If you are diagnosed with a Critical Illness, you would be required to submit a Diagnosis Report, duly signed & validated by the Medical Practitioner. Upon verification, the Insurance Company will pay a lump- sum amount equivalent to the Sum Assured. The amount can be used for expenses related to the treatment or any other miscellaneous expenses like travelling to & fro the hospital, attendant's expenses etc.
However, this comes with a Waiting Period which is usually 90 Days. It is advisable to check the Terms & Conditions with your respective Insurer, as it might vary from company to company.
When you are buying a Term Insurance cover, you will see the option of adding riders to your base plan. On opting for the Critical Illness Rider, you will next be presented with the option to pick the Sum Assured under the rider benefit. You are advised to go through the policy brochure to see the list of Critical Illnesses that are covered under the plan.
Once you are diagnosed with one of the pre-specified Critical Illnesses, you are required to intimate the Insurance Provider and offer the required details of your condition.
Once the Insurance Provider verifies the details offered by you and confirms the validity of the same, it will pay out the lump sum amount directly to your registered bank account.
Once you receive the rider benefits, you have the option to use the amount according to your convenience. You can use it for day to day expenses or to cover hospitalization expenses, or for any treatment recommended against the Critical Illness. Some Insurers may also provide the necessary cash flow during the recovery period.
Every Term Insurance Company comes with their own set of benefits and it is extremely important that you go through the information provided in their official websites and brochures before buying a plan.
With this rider, the policyholder can ensure proper treatment with the lump sum amount payable on the diagnosis of any one of the following conditions:
|Alzheimer's Disease||Angioplasty||Aorta Graft Surgery||Apallic Syndrome||Aplastic Anaemia||Benign Brain Tumor|
|Brain Surgery||CABG (Coronary artery bypass graft)||Cancer||Cardiomyopathy||Chronic Lung Disease||Chronic Liver Disease|
|Coma||Deafness||Encephalitis||Heart Valve Surgery||Loss of Independent Existence||Loss of Limbs|
|Loss of Speech||Kidney Failure (End Stage Renal Failure)||Major Burns||Major Head Trauma||Major Organ/ Bone Marrow Transplant||Medullary Cystic Disease|
|Motor Neurone Disease with permanent symptoms||Multiple Sclerosis with persisting symptoms||Muscular Dystrophy||Myocardial Infarction (First Heart Attack)||Coronary artery by-pass grafts (with surgery to divide the breastbone)||Parkinson's Disease|
|Permanent Paralysis of limbs||Poliomyelitis||Primary Pulmonary Arterial Hypertension||Stroke resulting in permanent symptoms||Systemic lupus Eryth. w. Renal Involvement||Total Blindness|
**It is advisable to check the coverage of Critical Illnesses under your particular policy.
The following table presents a few examples of Term Insurance policies that offer the Critical Illness Rider.
|Insurance Company||Term Plans||Critical Illness Benefit|
|PNB MetLife||PNB MetLife Mera Term Plan Plus||Coverage against 50 Critical Illnesses|
|Max Life||Max Life Smart Term Plan||Coverage against 64 Critical Illnesses|
|HDFC Life||HDFC Life Click 2 Protect Life||Coverage against 19 Critical Illnesses|
|Bajaj Allianz||Bajaj Allianz Life Smart Protect Goal||Coverage against 55 Critical Illnesses|
|SBI Life||SBI Life – Poorna Suraksha||Coverage against 36 Critical Illnesses|
|ICICI Pru||ICICI Pru iProtect Smart||Coverage against 34 Critical Illnesses|
In order to further emphasize on the importance of adding a Critical Illness Rider with your Term Cover, the following pointers attempt to highlight the seriousness of the medical situation in India.
The Cancer related data highlighted below is in reference to the Globocan (Global Cancer Observatory) India-specific report released by the Indian Council of Medical Research's National Institute of Cancer Prevention and Research (ICMR-NICPR) in 2018.
Moreover, a combined study by the Registrar General of India, WHO (World Health Organisation), and the Global Burden of Disease (GBD) reported that cardiovascular diseases (CVD) or also commonly referred to as heart-related health problems are one of the foremost causes of death and disability in the country.
The following set of data in regards to Heart Attacks was reported by the Indian Heart Association.
Because of today's hurried lifestyles, one out of every four Indians is at risk of dying from serious illnesses such as cancer or cardiovascular disease before reaching the age of 70. Treatments for these serious illnesses can put a family's finances in jeopardy, as the treatment costs for these ailments can rapidly reach lakhs.
Various studies suggest that the working population in India in the age bracket 30 to 74, is more prone to developing cardiovascular diseases and cancer. Other serious illnesses, such as kidney failure, sclerosis, stroke, or paralysis, demonstrate a rapidly increasing prevalence in the country.
This indicates the pressing need for a Critical Illness cover. Critical Illness Rider helps you get the right medical treatment without any financial burden,
Written By : Naval Goel
Last Updated : October, 2021
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