Critical Illness Insurance and Why You Need It

downloadMedical advances have extended our lives, but they haven’t made us immune from having a heart attack, stroke or being diagnosed with cancer.

While any of these is no longer a death sentence, they carry a hefty treatment cost. Medical insurance helps reduce those costs, but most plans don’t cover all the expenses of treatment, and families are increasingly turning to critical illness insurance to pick up the slack.

Critical illness insurance is a supplemental insurance, which can cost as little as $20 a month, and covers the expenses associated with cancer, heart attack, stroke and organ transplants.

Surviving a Critical Illness Is A Real Risk to Your Finances

  • Some 1.4 million Americans were diagnosed with cancer cases (this year). American women have a 63% chance of living at least five years after a cancer diagnosis (for men it’s 66%).
  • Every 40 seconds someone in the US has a stroke. 600,000 people will experience their first stroke (this year). 10% of stroke victims recover almost completely; 25% recover with minor impairments; 15 percent die shortly after the stroke.
  • Every 34 seconds, an American will suffer a heart attack. 785,000 will have a new heart attack (this year). Where medical care (defibrillation) is provided within 5 to 7 minutes, the survival rate from sudden cardiac arrest is as high as 30-45%.
  • 1.5 million Americans will declare bankruptcy this year. 60% are due to medical bills (up 50% over the last 6 years). 78% had health insurance but faced deductibles, co-payments and uncovered expenses + living expenses.

What Would I Use the Critical Illness Insurance Benefits for?

  • Cash to pay for medical treatments not covered by your health plan.
  • Cash to pay your mortgage while you are recovering.
  • Cash to pay bills – from car payments to insurance premiums.
  • Cash so you can travel for treatments not available locally.
  • Cash to pay for experimental treatments (not covered).
  • Cash to replace a spouse’s income while caring for the insured.

How Much Critical Illness Coverage Should I Carry?

One of the best ideas we’ve heard is to multiply your monthly mortgage payment by 24 (2 years worth). Imagine the peace of mind of knowing you’ll be mortgage-payment free while you recover and undergo treatment.


 Imagine the peace of mind knowing that your mortgage will be covered for two years while you focus on recovering. If you choose to add more, that’s fine. But 2 years worth makes a whole lot of sense.


How does the Insurance Company Calculate My Premiums?

The cost of critical illness insurance is based on four things:

  • How much of a lump-sum cash benefit do you want to receive?
  • Your age when you apply.
  • Your health when you apply.
  • If you use tobacco, you will pay more because the likelihood of getting a critical illness is much higher for smokers.

What You Don’t Know About Health Insurance Will (Really) Cost You!

This single fact stopped me cold. When you have a critical illness you are required to continue paying for your health insurance while you undergo treatment and recovery. Don’t believe me?  Call your health insurance company and ask!

It could take 6 months, 12 months or longer to recover from a heart attack or cancer. Will you be working and receiving a paycheck or earning a living during this time?  Nope. If you pay $300 a month for health insurance, you’ll have to come up with $3,600. You have no choice – you can’t drop your insurance.

How much of your health care is NOT covered by your health insurance? Your health insurance plan has a deductible. Is yours $1,000, $2,500 or $5,000 (each year by the way)? There are co-pays for services and drugs.  Have a serious illness and you are going to be taking drugs.  They won’t be cheap and you’ll gladly pay for them.

You could easily be facing anywhere from $5,000 to $10,000 if you have a critical illness. The cost of surviving a critical illness is steep. That’s why almost 2/3 of U.S. bankruptcies are the result of health issues. And, 80% of these people have health insurance.

PLUS You’ll have to pay your mortgage, your electric and phone bill, your car and car insurance (even if you aren’t driving). You get the point.

Getting Paid Through Critical Illness Insurance

Every day, real people just like you are diagnosed with a critical illness. If they have purchased critical illness protection, they’ll receive a lump sum cash payment. They’ll be able to use the money the way they want to; to pay for medical treatments that are not covered … to pay their mortgage while they recover … or in any way they need to.

You can’t predict how your health will change … or when. The best you can do is prepare now while you’re still in good health and can qualify for critical illness insurance protection.

Do I Personally Need Critical Illness Insurance?

Critical illnesses are striking more Americans every single year. I read that about 1.4 million Americans are diagnosed with cancer (American Cancer Society). An estimated 785,000 Americans will have a first heart attack and some 600,000 Americans will experience their first stroke (American Heart Association). The thing is, most will survive.

The financial consequences of surviving a critical illness are something few people are prepared for.  Life insurance will help your loved ones when you pass away, but what will help them while you’re still living with the financial effects of a critical illness?

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Do you know someone who has faced a critical illness?  How are they doing financially?  Tell us your story.

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