Life Insurance

Quality Advice about Getting Life Insurance

Life insurance is now widely accepted as a necessary investment to make sure loved ones are taken care of after your death. Yet, death isn’t the only thing which can take a toll on your loved ones. Every day, millions of people who have been diagnosed with critical illnesses are unable to work and provide for their families. Most of us know someone who has had cancer, heart attack, or stroke – the three most common critical illnesses – but not too many of us have critical illness insurance.


According to the American Association for Critical Illness Insurance, only about 600 thousand people in the country have this coverage. The main problem is that most people simply don’t realize that they can be covered in the event that they are diagnosed with a critical disease. In the scheme of life insurance policies, critical illness coverage is relatively new. The first such policy wasn’t sold until 1996.


As medical technology makes leaping strides forward, it makes much more sense for young to middle-aged people to invest in critical life insurance. Diseases which in the past were nearly always terminal – such as breast cancer – are now widely curable. Instead of the patient dying and the beneficiaries receiving the life insurance payout, the patient lives but the entire family is likely to be broke from the ordeal.


Going completely broke due to medical expenses is unfortunately very common. More than half of people who declared bankruptcy in the United States did so because of medical expenses – despite the fact that more than ¾ had health care insurance. Every year, about 1.4 million people are diagnosed with cancer. There is about a 63-66% chance that they will survive, but virtually all will have exhausted a significant (if not all) of their financial resources battling the disease.


Critical illness insurance covers all of the medical expenses which your health insurance does not cover, including the copay, deductible, alternative treatment costs, accommodation, and transportation. With critical illness insurance, you don’t have to worry about tallying the expenses because the amount gets paid in one bulk sum when you receive your diagnosis. Some critical illness insurance policies will even pay you again (though a smaller amount) if you get another critical diagnosis in the future. Considering that most people diagnosed with critical illness will have to take substantial time off work and lose out on their income, the critical illness insurance can take the financial stress away from being sick. All critical illness payouts are tax free.

Quality Advice about Getting Life Insurance

As with all life insurance, make sure that you are reading the fine print on the critical illness insurance policy carefully. Make sure you know what you will be covered for and for how long. In some cases, life insurance policies may even have riders for critical illness coverage.


When trying to determine how much critical illness insurance you need, you should first consider your monthly expenses, like your mortgage payment. Then, multiply this amount by 24 (2 years). Then, add another $5-10 thousand for medical costs. This total should then cover all expenses during the period you cannot work and also costs not paid by your health insurer.