What would happen if you or your spouse were unable to work because of a serious illness? Does your family’s household budget cover out of pocket co-pays, rehabilitation bills, experimental treatment or other daily expenses not covered by your medical insurance? How would you cover the cost of care for your children during treatment or recovery? When you’re dealing with the emotional stress of you or a loved one being sick, the last thing you need is financial stress.
Critical Illness insurance can protect you and your family from unforeseen medical costs if the unexpected happens. Here are three things to know about this voluntary benefit option that may be available through your workplace this open enrollment season.
1. It covers a range of serious illnesses.
A common misconception is that critical illness insurance only covers certain cancers. Critical illness can actually cover anything from a heart attack to a stroke to kidney failure, and even Alzheimer’s disease or a major organ transplant. Though it’s never an ideal time to think about this happening to you or a family member, it’s important to realize that these types of illnesses can happen to anyone, so it’s best to be prepared.
2. It provides a lump-sum for you to use as you wish.
According to MetLife’s Critical Illness Insurance study, those impacted by a critical illness also dealt with an average of over $50,000 in lost income. Like accident insurance and hospital indemnity insurance, critical illness insurance also provides a lump-sum cash benefit upon diagnosis that you can use however you see fit — whether it’s for household expenses, medical payments or personal needs for you and your family.
3. It’s different than disability insurance.
Besides differing coverage, one of the key differences between critical illness and disability insurance is how you’re paid. With critical illness, you receive a lump sum payment. Disability, on the other hand, provides periodic payments that cover a portion of your salary during the period of time you’re unable to work. Both benefits are important to consider during open enrollment, but the first step is to understand what you and your family need.
Though it’s never an ideal time to think about a critical illness impacting you or your family, open enrollment is one time of the year where giving it some thought could make a big difference when it comes to your personal financial wellness.