Modern lifestyle and increasing dependency on the use of frozen and fast foods, plus the use of preservatives to keep foods fresh may be adversely affecting the health of people. The busy schedules leave us very little free time to look after our health. Whole family works to make the ends meet and after a hard day’s work there is hardly any enthusiasm to cook fresh food at home. Even if we do, we rely on the freshness of foods available from our grocery stores that may be as a result of preservatives or genetic modification.

This is probably why we are seeing more and more of us ending up in hospitals with some hard to cure diseases, resulting in financial difficulties. Statistics (from Heart and Stroke foundation Canada) show that heart failure in on the rise. 50,000 Canadians are diagnosed with heart failure each year and 600,000 are living with it. And according to Canadian Cancer Society statistics, nearly 1 in 2 Canadians is expected to get cancer.

These are just 2 of many critical diseases that make us think about their impact on us and our loved ones when faced. Insurance industry amongst many different kinds of insurances, offers Critical illness insurance plans that can help people cope up with the hardships faced by people in such instances.


Critical Illness Insurance is insurance protection that guarantees a payment of a tax-free lump sum benefit in case the insured suffers from a critical illness. This benefit may be used to pay for insured’s treatment, pay regular bills and help his/her loved ones who may have to take time off their work for looking after the insured.


The insured must survive for 30 days after the diagnosis of critical illness. This period can increase up to a maximum of 180 days in certain cases. Critical illness should be diagnosed by your family physician. The insured own declaration does not constitute a valid claim. Based on physician’s certification/ statement and supporting medical record, the insurance company pays a lump sum payment depending on the coverage purchased.


You can insure yourself for the benefit amount as per your own needs/priority/ circumstance and are not bound to spend the benefit amount entirely on your medical treatment.

In the event of a critical illness, if the illness is considered eligible for payment of benefits, you will receive full payment of the face value. You can add features, as a Rider to policy, like ‘Return of premium on Death’, ‘Return of Premium on Expiry of Policy’ etc.

You are the beneficiary for the Critical insurance but, you can nominate a beneficiary. However, you must name a beneficiary for ‘Return of premium on death’ rider.

EXAMPLE: A 35-year old non-smoker female purchases critical illness coverage of $100,000 Plan Term-75 with, refund of premium on death and refund after 15 years riders. Under the policy, she will pay a monthly premium of $149.40 totalling to $1660.00 annually. In the duration of policy, if she makes a claim for an eligible critical illness, she will receive a cheque of the full face amount of $100,000. Any time after 15 years, she can apply for a full refund of premium paid to date. Unfortunately, if she dies after (say) 6 years of purchase of policy for any reason, her family will receive a full refund of paid premium amount of $9960.

Thus, in all situations, the insured/claimant has nothing to lose. It is a ‘forced investment’ for the benefit of the insured. While the insured is protected from unfavourable financial effects arising from the insured illnesses, it is also a saving for future that can be used as he/ she wish.

Due to lack of knowledge about its advantages, many people don’t buy critical illness insurance. People avoid it for different reasons. Those on low income feel consider it as an additional burden on their pocket. But, they fail to realize that, at the time of critical need, the absence of CRITICAL ILLNESS INSURANCE: PROTECTION FOR LIFE-THREATNENING ILLNESS an insurance coverage would make it even harder to cope up with the expenses incurred.

On the other hand, people having surplus sources of income feel that they have enough money to cover for their treatment during times of medical emergency. So, they don’t feel ‘the need’ to buy any insurance. But if they are insured, they would be able to leave their capital untouched for further growth instead of being drained away for medical treatment. Thus, by investing only a small fraction of your monthly income in critical insurance, you can save yourself during times of illness.

This article is © Copyrighted 2019-09- 25 and can be reproduced only with prior permission.

Sandeep Ahuja