A basic health insurance policy does an amazing job of reducing your medical expenses. Most plans will cover for pre- & post-hospitalization expenses and offer cashless treatment as well. However, when it comes to a critical illness, the protection of a normal plan is often not enough.
Take the example of Subodh. He had a basic individual health insurance policy with an annual sum assured of Rs. 5 lakh. Unfortunately, when he was age 35, he was diagnosed with cancer. His health insurance plan offered free-health check-ups so he was able to detect the illness in its early stages.
Even so, his medical expenses soon started to pile up. Before he knew it, the illness had already eaten through this coverage of this health insurance plan. Fortunately, he had added the critical illness cover to his plan. This add-on provided him a payout of 25 lakhs on the diagnosis of his condition. This helped him tide over all the expenses and recovery without the cost.
As you can see with the example of Subodh, having a decent amount of health insurance is not enough in case of a critical illness. The plan will offer some support but it will soon run out leaving you with several expenses yet to be covered.
This is because such illnesses usually have very expensive treatments. Moreover, the treatments are prolonged as critical illnesses usually take a while to cure. For example, cancer required multiple rounds of chemotherapy. This is why the average cost of cancer care is 5 to 10 lakhs. And remember that cancer is just one of the critical illnesses that could affect you.
Not mention, when diagnosed with a critical illness, you could also be out of work for extended periods of time. If you are the sole breadwinner of the family, this means your loved one has no income to cover household expenses. Not only that, but you could also have EMIs and other forms of debt that need to take care of. A health insurance policy will help cover some of the medical expenses but what about all the other heads of expenses?
This is why it is so important to get a critical illness cover with your health insurance policy. It will provide a cover on the diagnosis of 35+ critical illnesses. This amount can be used to cover any and all your expenses – it is not limited to medical expenses. Note that the payout is on top of the sum assured of your health insurance plan. So if you have a health insurance policy of Rs. 5 lakhs and a critical illness cover of Rs. 25 lakh, your combined coverage will be Rs. 30 lakhs!
Most plans will offer critical illness cover as an add-on for a little extra payment. Others will offer standalone critical illness plans. Financial experts favor add-ons as a standalone plan is as good as handling two health insurance policies. In case of a claim, dealing with an add-on will be simpler than making a claim on two separate plans.