Critical Care Insurance: Could Be Of Great Benefit
A relatively new type of insurance coverage, critical illness insurance can help pay for the high costs of recovering from a serious, life-threatening illness. Comprehensive and disability insurance covers many, but not all of the costs of recovery. If you are diagnosed with a covered illness, the policy can help pay for expenses not covered by other insurances such as:
Co-pays and deductibles
Experimental and alternative medicines
How it works:
When you're diagnosed with one of the covered illnesses, you will receive a lump-sum payment. Some policies may have a survival period, up to 30 days, that you must live after diagnosis. The policy may cover multiple illnesses, but it may only pay benefits for the first one. Some policies may spread out the payments over time.
Types of illnesses:
Coverage varies, but typically covered illnesses include: cancer, multiple sclerosis, heart attack, Alzheimer's, stroke, paralysis, renal failure, blindness, deafness, and organ transplant.
Costs vary based on several factors: age, medical condition, and the amount purchased. You may be denied coverage if you smoke or your family history includes heart disease, stroke, or cancer. Or you may have to pay a very high premium. Policies may also exclude pre-existing conditions.
Federal tax impact:
Proceeds from a critical illness policy are tax exempt. Some employer-provided policy's proceeds may be taxed. Check with your tax advisor.
Like all important decisions, seek competent legal and tax advice