Disability Vs Critical Illness Insurance: Learn the Difference

Written by : Knowledge Centre Team

2022-10-07

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The financial impact of health problems can be significant. Healthcare costs are a major expense for many families, and chronic health problems can lead to increased costs over time. In addition, chronic disease patients often have multiple health problems. This means that, for example, a person with diabetes may also have hypertension, arthritis, or asthma. They may require more expensive medications, tests, and procedures.

Moreover, health problems can lead to lost workdays and decreased productivity, which can hurt earnings.

The financial burden of chronic disease is not just felt by patients. It is also felt by their families and caregivers.

What is Disability & Critical Illness Insurance?

Disability insurance will compensate you for lost wages if you are unable to work due to a disability. Critical illness insurance is insurance that pays a lump sum benefit if you are diagnosed with a covered critical illness.

Disability is a long-term condition that may prevent someone from working or participating in activities they enjoy. An accidental disability is a sudden, unexpected event that results in a disability. A critical illness is a life-threatening condition that requires immediate medical attention. Some examples of critical illnesses include heart attacks, strokes, and cancer.

What is Covered in Disability Insurance?

Disability insurance policies cover a portion of an individual's income if they are unable to work due to a covered disability. The amount of income covered and the length of time for which it is covered varies by policy.

There are a variety of different types of disability insurance, each with its features.

Coverage for a certain period vs lifelong coverage.
Coverage for certain types of disabilities Vs any type of disability.
Some policies will only pay out a certain amount of money, while others will provide you with a full income replacement.
Critical illness plans like Health First Plan from Canara HSBC Life Insurance cover multiple types of severe disabilities.

The cost of disability insurance will vary depending on several factors, including the insurer, your age and health, the amount of coverage, and the length of the policy.

What does Critical Illness Insurance Cover?

Critical illness insurance coverage can vary from company to company and from policy to policy. The coverage provided by critical illness insurance may include, but is not limited to, the following:

Cancer
Coronary artery bypass surgery
Heart attack
Kidney failure
Major organ transplant
Multiple sclerosis
Paralysis
Stroke
Certain types of severe permanent disabilities

Disability Vs Critical Illness Insurance

Both disability and critical illness insurance plans offer support in different kinds of emergencies. Thus, have a few important and obvious differences:

Disability Insurance	Critical Illness Insurance
It pays a percentage of your income, up to a specified amount, if you are unable to work	Receive a lump sum as well as a regular income for up to 10 years
Your monthly pay outs begin after you have been out of work for 30-120 days, depending on your coverage.	When you survive critical illnesses for more than 30 days, the lumpsum amount is paid out.
Can cover permanent partial disabilities as well	The payment is made regardless of whether you can continue to work.
Buy as a rider with term insurance to include a premium waiver benefit for life cover	Minor stage cover is available under specific policies like heart or cancer insurance cover

iSelect Smart360 Term Plan by Canara HSBC Life Insurance allows you to cover yourself against 40 listed critical illnesses. The specific covers will also support you part of the benefit if you are diagnosed with early stages of the diseases.

How much does Critical Illness Insurance Cost?

Critical illness insurance costs can vary, depending on a person's age, health, and policy type. The insurance company may require a physical exam as part of the application process.

Critical illness insurance may be a good idea for someone who has a family history of serious illness or who is otherwise at risk of developing a life-threatening condition. Some people may feel that the peace of mind that comes with this type of insurance is worth the cost.

Learn how does your family history affect your life insurance premiums.

Which one should you Buy?

Some factors to consider include:

whether you have adequate savings to cover expenses if you are unable to work, and
whether you feel comfortable with the level of coverage and protection offered by either policy.
type of coverage you need
amount of coverage you need
length of time you need coverage
premiums you can afford to pay

Ultimately, it is important to weigh all these factors and make the decision that is right for you and your family.

There are a few things to keep in mind when buying disability and critical illness insurance:

Consider your Needs: Make sure to consider your specific needs when determining how much coverage to purchase.
Compare Policies: Be sure to compare policies from different insurers to find the best coverage at the most affordable price.
Get Quotes: Get quotes from multiple insurers to compare rates.
Read the Fine Print: Be sure to read the fine print of any policy before purchasing to ensure that you understand the coverage.

Disability and critical illness insurance can provide you with a safety net if you are unable to work due to an illness or injury. This type of insurance can help you cover your living expenses and medical bills while you are unable to work. So, strengthen your contingency plan by adding critical illness and disability insurance to your financial portfolio.

*Disclaimer :This article is issued in the general public interest and meant for general information purposes only. Readers are advised to exercise their caution and not to rely on the contents of the article as conclusive in nature. Readers should research further or consult an expert in this regard.