July 13, 2024

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Top 10 Ways To Save Money When Buying Critical Illness Insurance

4 min read
Critical Illness

The number of deaths caused due to critical illnesses has been increasing over the past few years. Such ailments can potentially reduce your ability to work, impacting your income. Critical illness insurance can be an effective tool, especially if you plan to invest in a policy that can financially cover you and your family members for any critical ailment you think you are susceptible to. 

Around 30-40 diseases are categorize under critical illnesses, but no base policy covers all. Although such a medical insurance policy may cost you more premium than any regular insurance plan, you can save money when buying it with the following tips.  

Tips for buying pocket-friendly critical illness medical insurance 

 – Know the risk involved: If you are genetically predispose to a specific illness or want to secure your future medical expenses in anticipation of contracting a disease, an insurance policy can provide cover for unexpected expenses. Hence, check for health risks to seek the best possible policy that provides optimum coverage. 

– If you get critical illness insurance for your parents age above 60 years of age, you can claim a total maximum tax benefit of ₹ 75,000/- with 25,000/- for yourself and 50,000/-. For those above 60 years buying a critical illness cover for their parents, you can avail of a maximum of ₹ 1,00,000/- as a tax benefit. 

– In India, the top-rated insurance companies cover 35 to 36 critical illnesses, which usually vary across insurers. However, you can find a standard list of threatening diseases generally covered by most critical illness insurance policies. 

– This policy can be purchase either as a standalone policy or as a rider with a basic medical insurance policy.

– Critical insurance policy offers coverage in the form of a fixed lump sum, especially on survival 30 days after diagnosis of the identified critical ailment.

– The critical illness medical insurance policy has a waiting period ranging from 30 to 90 days. Hence, any diagnosis done before the completion of the waiting period will not make you eligible to file a claim. 

– The assure sum is paid in a lump sum, allowing you to use the remaining amount for other needs after paying for the medical expenses. 

– In India, a comprehensive critical illness insurance policy can get a tax benefit of up to ₹ 25000/- under Section80D of the Income Tax Act, 1961 for your family members. For senior citizens, the annual tax benefit is capp at ₹ 50,000/-. 

Critical insurance plans come with a waiting and survival period. While the waiting period refers to the time gap between the purchase of an insurance policy and the diagnosed disease, the survival period is the number of days one survives after diagnosing a critical illness. It is best to check these features and their duration before investing in a policy.  You will not be eligible to claim the sum assured if you are diagnosed with a critical ailment against which you claim the completion of the waiting period.

– You can buy multiple critical illness covers and claim for all of those in case of an unfortunate event.

– You can check if your policy offers a partial surrender value, especially if the basic policy has been surrender and your premiums have been regularly paid. 

– Some policies provide a free look period of around 15 days to new policyholders that allow you to return the policy stating the reason for objecting it. 

Scrutinize your critical illness insurance policy

Every critical illness policy is unique and likely to pay a lump sum at the time of diagnosis of an ailment regardless of the hospitalization cost or the medical expenses incurred. 

As a critical insurance policy aims to compensate for the loss of income of an insurance holder, it ensures that the family can meet their necessary expenses without any hardship. You can always opt for a critical illness cover and an adequate mediclaim policy. If your health insurance does not offer an add-on, you can invest in separate critical illness insurance. 

As a policyholder, it is essential to know about the settlement process. Some companies also provide a complete cashless facility and insist on the submission of all documents by the insured individual after the event is over. From finding out the settlement history to the network of hospitals, ensure you know all about the insurance company and its critical illness medical cover. 

Tax Benefits

You can enjoy tax benefits on premiums paid towards maternity health insurance plans under Section 80D of the Income Tax Act, 1961.

Financial security

The health insurance with maternity benefits covers all normal and c-section delivery expenses and ensures financial security for the parents.

Developing a lifestyle disease has become common in the fast-paced world. Instead of assuming that a health insurance plan is sufficient to cover all your medical expenses, doing a market survey and using the tips to invest in a comprehensive critical illness insurance policy is best. 

Knowing your policy waiting and the survival period to make a conscious claim is imperative. Also, make sure you understand the exclusions of the critical medical insurance policy you opt for just as well as you have the policy inclusions at your fingertips. 

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