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Is a Critical Illness Policy Right for You?

You may not be familiar with the term critical illness policy, but you should be, because having one could save your life.  Basically, a critical illness policy is supplemental insurance that covers your medical and living expenses if you encounter a health crisis like cancer or stroke.  Most insurance policies may pay for a portion of the medical bills if you have a serious illness, but, in most cases it won’t be enough for a prolonged treatment.

If you develop a serious medical condition like cancer or HIV, you will probably pay tens of thousands of dollars for hospital stays, physician care and prescription drugs. Unless you have a first class health plan, your primary policy will likely only pay for a portion of these expenses. Without a supplemental critical illness policy, you could face mounting bills, foreclosure or bankruptcy.

High Cost of Serious Illnesses

According to the actuarial firm Milliman, the ten most common health emergencies and the average annual cost to treat them in 2012 were as follows:

  1. HIV/AIDS $25,000
  2. Cancer $49,000
  3. Organ transplant $51,000
  4. Stroke $61,000
  5. Hemophilia $62,000
  6. Heart attack $72,000
  7. Coronary artery disease $75,000
  8. Premature infant $101,000
  9. Renal disease $173,000
  10. Respiratory failure $314,000

Many of these common conditions can strike people at any point in their lives. When they do occur, many sufferers must often make heart-wrenching decisions about finances and personal health. Sadly, without adequate health coverage, many ill people are forced to opt for less effective therapies or no therapy at all.

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If you possess any of the risk factors for these conditions like smoking, drinking, obesity or genetic factors, discuss with your doctor the possibility of these illnesses arising in your future.  It may be uncomfortable to openly talk about a major illness striking you, but your physician can offer reliable advice about how to lower your risk.

Furthermore, early diagnosis and treatment can prove critical in managing a condition. Not only do your chances of survival go up dramatically improve, but therapies for early stage illnesses may be significantly less expensive than those for diseases that have progressed much farther. It is therefore important to see your physician on a regular basis—at least once a year—and get screened for these major health conditions, especially if you possess a high risk.

The Problem with Traditional Insurance Policies

You may be wondering how a critical illness policy is different from your current health insurance policy. If you have coverage through your employer or one of the Obamacare health insurance marketplaces, then you may not realize how exposed you are to financial risk if you encounter a major health issue.  Many of these policies are known as high deductible policies, which means that you probably have to pay thousands of dollars each year before your insurer will start paying out.

Many of these policies also have caps on how much they cover.  Your current policy may only pay for a certain amount of your medical bills, leaving you unable to continue your treatment once that maximum has been reached.  Additionally, your policy may have coverage gaps that won’t pay for products or services like experimental treatments, new drug therapies or in-home care.

Finally, your traditional health insurance plan won’t pay for various living expenses like lost wages, mortgage payments and medical travel expenses. If your illness forces you to take a leave from your job, these non-medical bills could quickly pile up and further strain your finances.

The Solution is a Critical Illness Policy

Modern medicine is miraculous.  In recent years, scientific research has created powerful therapies for many of the most troubling conditions that may have been a death sentence only a short while ago.  Unfortunately, these breakthroughs depend on long years of costly research that force manufacturers to place a large price tag on their products.  This means that, if you become seriously ill, you will probably need to pay a hefty amount to get better.

A critical illness policy is a powerful way to protect yourself from the financial disaster that often accompanies a major illness. There are a wide variety of policies that can protect you from conditions like cancer, Alzheimer’s disease, heart disease, or coma. A single policy may include coverage for three conditions up to as many as 20. They are available for individuals or families, typically at very affordable rates.

If one of the covered health conditions does arise in a policyholder, the total payout may range from $10,000 up to $1 million, depending on your monthly premium and policy terms.  You should keep in mind that this payout is usually on top of the coverage that your primary policy offers. In many cases, the payout can be a lump sum provided to the policyholder.  That means that the money may be used in a number of ways including payment of medical bills, rent or other living expenses. A critical illness policy does not alter your primary health plan, it merely adds coverage.

There may be some restrictions on your critical illness policy.  Most policies are limited to a set amount of time, after which you will need to obtain a new policy. Others may lower the amount paid out as you get older. If you want to purchase a large payout policy, you may be required to undergo a medical evaluation first. Finally, if a condition arises a second time, your insurer may not cover it.  If you are unsure what your critical illness policy covers, you may find answers by discussing your policy with a critical illness policy expert like those found at Boost Health Insurance.

With a critical illness policy, you no longer need to worry that your primary health policy is insufficient. Over a million Americans have purchased a critical illness policy since they first became available in 1996, and they are becoming increasingly popular.  With a supplemental policy, you can be confident that you will have the financial resources necessary to fight off a major health issue.

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