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Who needs critical illness insurance?

Critical illness Insurance (CII) is designed to manage the risk associated with contracting dreaded diseases. The core diseases covered by all CII policies are cancer, heart attack and stroke. Some CII policies pay a lump sum benefit if the individual is diagnosed with kidney failure, or requires major organ transplant, or coronary artery bypass surgery. Several other ailments may be covered by a CII policy depending on the insurance company.

Critical Illness Insurance is not a replacement for other types of insurance coverage such as life or disability income insurance but rather compliments life and disability insurance coverage in several unique ways. Unlike life insurance where the death benefit is received by the beneficiaries of the insured, the CII benefit is payable directly to the insured. Unlike disability insurance, CII is not based on the insured’s ability to work. Furthermore, the payment of CII benefits is not based on the severity of the condition, and are not repayable to the insurance company should the insured make a full recovery.

As an insurance product, CII helps in managing an unknown risk. If that risk should strike, in the case of a critical illness, there is no doubt that additional funds could make a significant difference to the quality of the individual’s life, or even their survival. Financial needs that can be addressed by the proceeds of a CII benefit could include the refitting of houses and cars, access to health care in other countries if not available in Canada and even vacations in the case of terminally ill patients.