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How Does Critical Illness Insurance Work?

Compared to health and life insurance, critical illness insurance is a topic that’s not discussed as much. As a result, you might be unfamiliar with how it works. Anyone at risk of a serious illness or not financially prepared to treat one should know what critical illness insurance is. Here is some key information to help you become familiar with this type of insurance.

What is critical illness insurance?

A critical illness insurance policy helps cover specific medical conditions such as cancer, heart attacks, and strokes. These are conditions that typically bring about a high medical cost for treatment. The insured person can receive a one-time lump sum that can be used to help pay off any expenses they choose. It may be used to not only help with medical expenses but also daily living expenses and make up for lost income due to time away from work. The cost of paying for critical illness insurance is typically much lower in comparison to health insurance.

How critical illness insurance works

After you’re diagnosed with a covered condition, a critical illness insurance company will pay out a lump sum benefit amount. The insured person must submit a claim for the benefits, and then the benefits can be paid directly to the individual, unless assigned otherwise. Similar to health insurance, the cost of the coverage can vary based on age, health, and other factors. People who are in good health and younger will often get a lower premium.

What critical insurance covers

Critical illness insurance helps cover common serious conditions and illnesses. Conditions that are on many critical illness insurance plans include cancer, heart attacks, strokes, kidney failure, and paralysis. Some policies will allow you to include riders to complement your coverage. Riders are additional terms to add to your policy, such as coverage for other critical illnesses or coverage extended to your spouse or child.

Some plans also give you the option of getting a return of premium rider. That allows for a portion of your premiums to be given to your family if your death is caused by a critical illness that’s not covered in your plan. It’s important to be aware that some policies do have restrictions on how they will payout your benefits. As an example, the policy could indicate that you’ll only receive a full benefit for a specific set of cancers. If you’re diagnosed with a less severe cancer, you may only receive partial benefits or possibly no benefit at all.

It’s important to carefully read through the plan to know what restrictions there are when it comes to receiving the lump sum amount. You can consider adding riders to make sure the condition you’re concerned about is covered. Having a good understanding of your family history can help you decide which serious illnesses are best for you to have covered. Be sure to review different critical illness insurance policies to find one that offers the type of coverage you need at an affordable price.

In Arkansas, Policies B71100AR & B7110HAR. In Oklahoma, Policies B71100OK & B7110HOK. In Oregon, Policies B71100OR & B7110HOR. In Pennsylvania, Policies B71100PA & B7110HPA. This is a brief product overview only. Coverage may not be available in all states including but not limited to: ID, NJ, NY & VA. Benefits and/or premiums may vary based on the state and benefit option selected. Riders are available for an additional premium. The policy has limitations, exclusions and pre-existing condition limitations that may affect benefits payable. The policy may contain a waiting period. Refer to the policy for benefit details, definitions, limitations and exclusions. For costs and complete details of the coverage, contact your Aflac insurance agent/producer.

The content herein is provided for general informational purposes and is not provided as tax, legal, health or financial advice for any person or for any specific situation. Employers, employees and other individuals should contact their own advisers about their situations. For complete details, including availability and costs of Aflac insurance, please contact your local Aflac agent.

Aflac insurance coverage is underwritten by Aflac. In New York, coverage underwritten by Aflac New York.

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