Critical Illness Cover As A Rider

Medical costs are rising exorbitantly. Survey says that medical inflation is rising by 12% which is exponentially high. The most perfect health cover which you can gift yourself and your loved ones is a Critical Illness Rider. Critical Illness comes as a rider. The insured gets a lump sum amount if diagnosed with critical illness. Some of the critical illnesses are heart attack, kidney failure, paralysis, cancer etc…These potentially fatal diseases can burn a hole in your pocket. This life rider either covers costs of the treatment or the repayment is done against the bill amount. You can buy this policy as a standalone policy or as a rider along with a life insurance policy. In life insurance policy the dependents of the policy holder gets death benefits as in a lump sum amount is paid to them. Critical illness rider you are paid a lump sum in case you are diagnosed with any of the above critical illnesses. The lump sum amount is tax free.

1. More about the policy: The Critical Illness Rider can be bought with a term plan as well as life insurance policy, the sum assured is linked with the basic policy. No additional cost is charged as the premium remains the same throughout the tenure of the basic policy. The premium increases as you grow older. The minimum entry age is 18 yrs. and the maximum is 65 years. The payment mode depends on the insurer. It may be quarterly, half yearly or yearly. 

2. The ideal amount for cover: Higher the intensity of the illness higher should be the cover amount. The cover amount should ideally be 4 times of your total income. If you are financially well off you can definitely afford cover of higher amount.

3. Waiting Period: After you are diagnosed with the mentioned critical illness in the policy the claim can be proclaimed if the insured survives for said period of time i.e. if the insured should not die before 30 days. There is also a waiting period of 90 days after the policy comes into action. Any illness which is diagnosed within a time of 90 days cannot be claimed.

4. No Claim Bonus: If you do not make a claim in the past years the sum assured increases every year. Many insurance companies give an additional 5% increase in sum assured amount.

5. Claims: In case of claims a detailed medical information is required. It takes a maximum of 30 days to settle one. Though it differs from insurer to insurer. No hospitalization is required to claim benefit. 

6. Tax Benefit: The plan offers lucrative tax benefits. Under Section 80(D) of the Income Tax Act, 1961 the premium amount is tax deductible.

7. Renewal: The critical illness rider policy gets automatically renewed at the time when the base policy gets renewed.

Comparative research and a detailed study of the pros and cons may help you fetch a good policy. Look for the company that offers seamless claim process. If there is a family history of any critical illness then you should get yourself covered at first.  Saving the soul from paying hefty bills and avoiding financial set back.