Despite taking both life and health insurance policies, policyholders are suggested to opt for a critical illness rider. This is because it helps policyholders manage their finances well in case of an eventuality.
Those who are not aware, a critical illness rider is attached to the life insurance policy and provides financial protection against life-threatening critical illnesses.
This is how it works
During the policy term, if any of the specific illnesses are detected, the insurer issues the amount as lumpsum. This money can be used for anything including treatment, compensating for loss of income, hospitalisation, among others.
This amount is given regardless of the total medical expenses incurred. And this money is disbursed only once. The list of critical illnesses is given in the policy document.
These typically include cancer (specified stages), heart attack, stroke, kidney failure, organ transplant, paralysis, multiple sclerosis and coronary artery bypass surgery.
Why should you opt for it?
I. It helps you club health insurance and life insurance. Along with life insurance, you could get health insurance cover, albeit with regards to critical illness only.
II. This is unrelated to hospitalisation and other expenses. This means even if hospitalisation expenses turn out to be lower – policyholders are entitled to receive a lumpsum which they could use for miscellaneous expenses.
III. This provides financial support for expensive medical treatments.
IV. This rider entails a lump sum payout for flexible use.
V. There is no need to submit medical bills to be able to claim this.
VI. Premium charged for critical illness riders is lower as compared to standard health insurance policies.
When should you take it?
This policy is beneficial in case you have a family history of critical illnesses and you happen to be the sole breadwinner. It also makes sense if your health insurance has low coverage.
However, if you have a comprehensive health insurance plan which has a higher sum insured, then this rider may be unnecessary.
