What are the Insurance Jargons Related to Critical Illness Insurance?

Fighting a deadly health condition can be exhausting. However, with timely diagnosis and early treatment, one can recover fully and manage to live normal lives again.

The only concern will be the exorbitant treatment expenses that may otherwise take a toll on your savings. Hence, investing in a health insurance plan is essential. Specifically designed for critical illnesses, the critical illness insurance plans cover all the major medical expenses. To understand such a policy in detail, you need to have an understanding of the various terms and clauses of the policy, like the critical illness waiting period.

This article will discuss major terms of a critical health insurance plan, like critical illness insurance waiting period, no claim bonus, etc. Read on to know in detail.

Importance of Critical Illness Health Insurance

Investing in a critical illness health insurance plan can be quite beneficial in case you or any of your insured family members is suffering with a life-threatening disease. Insurance plans like Critical Illness Insurance offered by Care Health Insurance comes with comprehensive coverage and a strong financial cushion for the insured.

Although a health plan cannot decrease your risk of exposure to a certain disease, covering the expenses can be a huge financial relief. Also, when you have an insurance policy, you can seek the best diagnostic services that help detect an illness at an early stage. Care Health Insurance offers high coverage for over 32 critical illnesses. AYUSH treatments are also covered in the plan, so alternative treatments are available as well.

People who have a family history of critical illness or are at a higher risk of it may consider investing in a health plan. Also, the breadwinner of the family is also advised to invest in critical illness insurance so your family does not have to go through a financial crisis during hard times.

Essential Terms of Critical Illness Health Insurance

Reading policy documents is quintessential, and even if it sounds boring enough, try not to skip it. Policy papers have all the necessary details that you need to know in order to make the most of the policy. Let's understand about critical illness policy waiting period and more:

1. Waiting Periods

One of the often-heard terms is a waiting period in critical illness policy. As the name suggests, the waiting period in a health insurance policy is the time period until which you cannot raise a claim. In a critical illness policy, the waiting period is 90 days after policy purchase. For any pre-existing diseases, the waiting period is 24 months. If you raise a policy during the waiting period, the policy gets rejected.

2. Pre-existing Conditions

Any disease or health condition of an insured that existed before purchasing the policy is known pre-existing condition. The waiting period for critical illness in case of pre-existing conditions is 24 months. Diabetes, thyroid, etc., are common pre-existing illnesses, especially for people above 45 years of age.

3. Indemnity cover

Indemnity cover in an insurance policy refers to the compensation offered by the insurance provider when the insured is diagnosed with a critical illness. The  compensated amount can be utilised to meet the medical treatment costs.

4. Illnesses Covered

With Care Health Insurance, you get coverage for over 32 critical illnesses. Depending on the chosen plan and the insurance provider, the coverage may differ.

5. Policy Renewal

Any health insurance plan has to be renewed before its date of expiry to continue availing services. With our critical illness insurance policy, you get the benefit of lifetime renewal.

6. No Claim Bonus (NCB)

When you raise no claim in a policy year, the insurance company rewards you with no claim bonus. You can avail the benefit of a discount on premiums while renewing the policy. With each claim-free year, the NCB increases and a maximum of 50% reward is offered. However, if you raise a claim in any year, the NCB lapses.

7. Optional Benefit

Optional benefits are the additional cover that you can purchase along with your base plan. Some of the popular optional covers are international second opinion, air ambulance cover, and room rent modification.

8. Policy Exclusions

Apart from the waiting period critical illness, there are several other exclusions in a policy. Exclusions refer to the conditions that are not covered by a health insurance plan. Make sure to know all the exclusions in detail.

9. Tax Benefits

Like any other insurance plan, critical illness insurance also offers tax benefits. Under Section 80D of the Income Tax Act of 1961, ₹25,000 tax deductions can be availed (senior citizens can avail tax deductions up to ₹50,000).

Individuals who have purchased critical illness insurance for their older parents above the age of 60 are also eligible for tax deductions. ₹75,000 tax deductions can be availed if the premium exceeds ₹1 lakh.

*Among plenty of terms the aforementioned are just a few. Kindly refer to the policy document for detailed information to avoid any consequences in the time of claim.

>> Also Read: Protect Your Family from Critical Diseases with the Best Health Insurance

What should I Buy: Critical Illness or Regular Health Insurance?

When a regular plan covers hospitalisation, why should invest in a critical illness plan? Which kind of policy is better? Do I need both kinds of health plans? These are just some of the questions that may come to your mind when you are thinking about buying health insurance. While there is no denying that a regular health insurance plan will cover your hospitalisation expenses if you are diagnosed with a critical illness, you need to know that the coverage you receive depends on the type of policy that you have.

Treatment of critical illnesses can be heavy on the pocket. Will the sum insured be adequate to cover all the expenses, such as medical expenses, replacing lost income, or making necessary lifestyle adjustments? In such a scenario, the lump sum you receive can prove to be very helpful. If you are looking for comprehensive health insurance, then like a lot of people, you too can make use of both these kinds to complement each other. It's essential to carefully review the terms, conditions, and coverage of each policy to make an informed decision based on your unique needs and circumstances. 

Summing Up

Critical illness insurance can be a huge backup for a person with critical illness. Diseases like cancer are not just physically exhaustive but also drain your savings. Hence, having health insurance in such times is a great decision. You can invest in a plan that best suits your needs. Comprehensive plans like those offered by Care Health Insurance can best assist your needs. Before you purchase a plan, you may ask your insurance provider to explain to you the essential terms, like the waiting period for critical illness.

We wish you good health!

Disclaimer: All plan features, benefits, coverage, and claims underwriting are subject to policy terms and conditions. Kindly refer to the brochure, sales prospectus, and policy documents carefully.