We’ve heard a lot of questions around critical illness riders in health insurance or term insurance policies - if it is really worth buying and what the alternative options (if any) are.
We thought we should settle this question - once and for all! So, here we go!
Why do you need a Critical Illness cover?
A critical illness - a serious disease or medical condition can cause serious financial damage to your family, possibly - even worse than death. Even if you have a good health insurance policy to cover all your hospitalization expenses, you will end up spending out of your pocket for major expenses such as renovating your house to make it suitable for your use, redoing your car, etc. Plus, you’re likely to incur several long-term expenses towards medical bills, doctor visits, and hiring of nurses/ household help.
All this, while your source of income is either lost or substantially reduced. We’ve known senior leaders from huge multinational companies giving up their high-paying jobs, and taking up less stressful roles - after suffering from a stroke or a heart attack. In other cases, we’ve heard of individuals who had to discontinue working - temporarily and permanently as a result of getting cancer - with long-term chemotherapy needing several months of treatment to work.
If your family largely depends on your earnings for their expenses - you should seriously consider a critical illness cover that will provide your family with the financial relief to deal with a serious disease and the costs that follow, without compromising on their current lifestyle.
2 ways to get a Critical Illness Cover
You can get a critical illness cover in one of two ways.
- As a Rider - as discussed above, as an add on attachment rider over your term insurance plan. For an additional cost and no extra paperwork - you will be able to take this critical illness cover.
- Separate specialized policy - as a separate critical illness insurance policy. Such policies are designed for a specific purpose and are therefore comprehensive covers. They can, however, get expensive (especially after you grow older or get a disease) and a high coverage may require mandatory medical tests.
Here’s a quick comparison of a critical illness rider and a Separate specialized policy - to help you make a decision.
| Critical Illness Rider | Separate specialised policy | |
| Type of policy | This is an add-on, on a base term insurance, health insurance or life insurance plan. | This is a separate comprehensive policy |
| Limits on Cover amount | The coverage amount you can buy is limited to your base cover. | There’s no limit, so you can buy any amount of cover |
| What stages of Critical Illness are covered? | Cover only advanced or final stages | Separate plans may cover early stage critical illness too. |
| How complicated is the buying process? | Part of the main plan, hence no separate paperwork or medical tests required | You will go through all due diligence - including documentation and medical tests wherever necessary. |
| Premiums | Initial premiums could be similar to standalone riders. However, premiums usually remain fixed for a long duration or the entire term based on the plan. | Premiums change as your age changes. It can become very expensive in old age. |
Learn about critical illness insurance in detail, in our recently launched eBook - The Most Definitive Guide To Critical Illness Insurance. Download your free copy here.
How to decide which one is right for you?
If you’ve to make a decision about buying the right critical illness cover for yourself, here’s how you should compare your two options.
- If convenience and cost is a priority: If you’re looking to buy the policy without too much effort, or at a relatively lower cost - choose a critical illness rider, along with your term insurance policy.
- If you want to provide adequate cover for your family: If you’re someone who doesn’t want to compromise on the quality of cover, and are willing to pay the additional costs - you should pick a Separate specialised policy. This will also mean you’ll spend time being diligent about all the features and benefits, and fill additional documentation for the plan. But, it’ll be worth it as your family will get a very dependable cover.
We hope this article has clarified at least some of the questions you’ve got about the critical illness insurance plans - riders and comprehensive covers.
Comparing Term Insurance Plans on the basis of Critical Illness Riders
If you’re planning to buy term insurance with a critical illness cover as a rider, you must be very careful about the ‘type’ of rider you pick. Some insurers exclusively offer comprehensive riders while some, accelerated ones. And there was no way to compare term insurance plans based on critical illness riders before. But, now - things have changed!
We bring you MyInsureBuddy⭐Ratings, the first-ever unbiased and data-backed solution for insurance comparison, where you can objectively compare term insurance product features - including critical illness riders, and make an informed purchase decision. MyInsureBuddy⭐Ratings is accessible for free, for all our community members.
So, if you are looking to find the best term insurance plan for your family - check out MyInsureBuddy⭐Ratings right away.
If you have any specific questions and would like to understand the right insurance plan for you, post them on the MyInsureBuddy Forum, and get answers from experts for free!