“Even with excellent medical insurance, just one critical illness can be a tremendous financial burden,” says CFP Jeff Rossi of Peak Wealth Advisors, LLC. Your health insurance plan may cover some of your medical costs, but not everything. In the event of a serious illness or condition, critical illness coverage (sometimes called catastrophic illness insurance) acts as an additional layer of protection and helps with expenses that your health insurance may not cover. Critical illness insurance provides lump-sum cash benefit that can be used to help you pay for medical expenses not covered by insurance, such as copays or coinsurance, expenses incurred before the deductible has been met, and other out-of-pocket costs. A qualifying illness, like cancer, heart attack, or stroke, will trigger the policy’s benefit, which is paid directly to the insured. The covered conditions under your critical illness policy will vary depending on your plan.
What is Cancer Insurance?
If you have a family history of cancer or at a higher risk for other reasons, a cancer insurance policy may provide you with some peace of mind. Cancer plans cover an array of medical and non-medical costs that your basic health insurance plan may not provide coverage for, including coverage for radiation and chemotherapy, surgical procedures, hospital confinement, loss of income, transportation and lodging while traveling, and more.
Depending on the plan, cancer policies may pay a lump sum when you receive a cancer diagnosis, while others may pay for specific treatment and care expenses either directly to your provider or to you.