Is Critical Illness Insurance Worth It or Not?

It goes by many different names – cancer insurance, dread disease insurance, specified disease insurance. Regardless of what it’s called, it’s designed to help you stay on top of your finances if you’re diagnosed with an expensive serious illness or condition.

Learn More: What Is Critical Illness Insurance?

If you are diagnosed with a covered disease or health event, a critical illness insurance policy will help you focus on your recovery by supporting your finances. When you’re diagnosed, you’ll receive a lump sum of money paid directly to you. You can use the money for whatever you need, from replacing lost wages or traveling for treatment to taking extra time off work or paying off your medical bills. 

Critical illness insurance covers some of the most common serious illnesses and conditions. Depending on your critical illness insurance policy, you could have a long list of rarer ones covered – but Assurity’s Critical Illness insurance is simplified to cover the most common conditions and keep costs low for you. It pays a benefit for:

• Cancer (invasive or non-invasive)*

• Heart attack**

• Stroke

• Advanced Alzheimer’s disease

Watch this short video to learn how critical illness insurance works. 

Like many other types of insurance, you can get coverage from an insurance professional near you – but these days, it’s even faster and easier to get coverage online. If you want to see how much your coverage might be, you can get your personalized price with our online quoter. 

If you like what you see, you can complete an application and protect your future in just minutes.

The process of making a critical illness insurance claim can vary depending on the product you buy and the carrier you buy from, but with Assurity, it’s easy. Once your doctor diagnoses you with a covered illness after the waiting period, you can submit a claim through our customer portal, MyAssurity. After that, you’ll receive your benefit payment.

Once your critical illness insurance claim is processed and approved, you’ll receive the benefit in one lump-sum payment. You can receive benefits for more than one diagnosis, provided it’s a different condition and separated from your first diagnosis by at least six months (depending on the state where you live).

How much you pay in premiums for critical illness insurance depends on several factors, such as your age, whether you use tobacco products, or if you opt to include “riders” – add-on coverage that may provide benefits for other ailments, or perhaps returns your premium if the policy is never used. The most significant factor, however, is the benefit amount you select. 

If purchased early enough, critical illness insurance can be very affordable. With a benefit amount of just $25,000, you could help cover out-of-pocket costs your health plan doesn’t and ease the financial stress of both the extra costs of recovery and everyday expenses. A policy like that could cost less than a dollar a day. 

Unlike some other critical illness insurance plans, Assurity’s Critical Illness Insurance doesn’t raise your premiums when you turn 65. So, if you choose to buy an Assurity Critical Illness Insurance plan, you can rest easy knowing you’ll never have to pay more than you thought, and can renew your policy for life. 

Use our quoter to get a good estimate of how much a policy would cost for you or a loved one.

Is critical illness insurance right for you? Let’s examine the risk of diagnosis, the odds of surviving a critical illness and the costs of medical care so you can make an informed decision.

The risk of diagnosis: We’ll start with the bad news: Critical illnesses are more common than anyone would like, with millions of diagnoses occurring each year in the United States. In 2020, that included 1.8 million cancer diagnoses. Heart attacks and strokes are less common, but barely – 795,000 strokes happen each year, the leading cause of adult disability, and more than 800,000 people will suffer a heart attack annually.  

The odds of survival: With the bad news out of the way, here’s a silver lining: More people than ever are surviving critical illnesses. By 2030, it’s estimated that there will be more than 22 million cancer survivors in the US alone. With continuing advances in medicine, it’s likelier than ever that you’ll survive a critical illness – but many people still struggle with the financial fallout of a serious disease years after they recover.

The financial burden of critical illness: Consider how much healthcare costs – if you have a High Deductible Health Plan (HDHP), you could face out-of-pocket costs as high as $14,100 before your insurance kicks in. And if you’re undergoing treatment for cancer or another serious condition, you may face these out-of-pocket costs for multiple years. Add that to lost wages from time off work, travel expenses if you need to go out of town for treatment, childcare if you can no longer manage it… it can quickly seem overwhelming.

Almost a third of Americans had medical debt in 2020. You might know some of them. Critical illness insurance is there to help you meet essential expenses, no matter what they are, so that you can maintain your lifestyle and avoid falling behind on your finances.  

What is critical illness insurance?

Critical illness insurance helps to protect your finances by paying you cash if you’re diagnosed with a covered condition or serious illness. It gives you a lump sum that you can use for anything you need.

How do I know if I need critical illness insurance?

Could you meet several years’ worth of out-of-pocket costs from your savings alone? What if you had to miss work, or were disabled by a serious condition? Critical illness insurance is for anyone who wants a safety net to help maintain their finances if the unexpected occurs. 

How much coverage should I consider when purchasing critical illness insurance?

We recommend $25,000 worth of coverage for most people – it typically costs just a few dollars each month. But you may need more or less coverage depending on your unique circumstances. You can get a quote to see how much your coverage might cost and find out how much is right for you.

Does critical illness insurance have any exclusions or limitations?

Yes. Policy benefits may be delayed or may not be paid under certain circumstances, such as misstated answers when applying, pre-existing conditions or conditions caused by drug addiction, illegal actions or high-risk activities. You can see full limitations and exclusions here. 

How do I make a claim on my critical illness insurance policy?

You can easily make a claim using our convenient customer portal, MyAssurity, or by contacting Assurity directly. You’ll receive instructions for activating an account on MyAssurity once you’ve purchased a policy. You may need to submit supporting documents, such as physician’s statements, when making a claim.  

Will the payout from my critical illness insurance policy be taxed?

No. Critical illness insurance payments are tax free, so you’ll get the full amount without needing to pay taxes. 

With all this knowledge in hand, it’s time for the final step — getting a critical illness insurance policy. Check out Assurity’s Critical Illness Insurance for more information, resources and examples.

Get a Quote

Additional disclosure information

LIMITATIONS AND EXCLUSIONS (may vary by state)

Pre-existing Condition. Pre-existing condition means a sickness or physical condition for which, during the 12 months before the issue date or last reinstatement date, the insured person received medical consultation, diagnosis, advice or treatment from a physician or had taken prescribed medication. No benefits will be paid for a critical illness that is caused by a pre-existing condition unless the date of diagnosis is after the policy has been in force for 12 months from the issue date or last reinstatement date.

Waiting Period. Waiting period means the 30 days following the issue date or ten days following the last policy reinstatement date. The date of diagnosis of a covered critical illness must be made while the coverage is in force and after any waiting period. No benefits will be paid if a diagnosis or a medical consultation that leads to diagnosis of invasive cancer or non-invasive cancer occurs during the waiting period. If cancer is diagnosed during the waiting period, benefits will be paid for a subsequent diagnosis of cancer if the insured person is symptom- and treatment-free for at least 12 consecutive months and in complete remission prior to subsequent diagnosis.

Misstatement of Age and/or Gender. If the insured person’s age and/or gender has been misstated, an adjustment in premiums, coverage or both will be made based on the correct age and/or gender. If, according to the correct age, the coverage provided by the policy would not have become effective or would have ceased, Assurity’s only liability during the period in which the insured person was not eligible for coverage shall be limited to a refund of premiums.

Misstatement of Tobacco Use. If, during the first two years of the policy, the tobacco status of the insured person has been misstated, Assurity will revise the policy’s benefit amount to the amount the premium paid would have purchased using the correct tobacco status on the issue date.

The policy will not pay benefits for losses that are caused by or are the result of an insured person:

• being exposed to war or any act of war, declared or undeclared;

• actively serving in any of the armed forces or units auxiliary thereto, including the National Guard or Army Reserve, except during active duty training of less than 60 days;

• engaging in hang-gliding, hot air ballooning, bungee jumping, parachuting, scuba diving, sail gliding, motor vehicle racing, parasailing, parakiting, mountain or rock climbing, B.A.S.E. jumping, sky diving or cave diving;

• being addicted to drugs or suffering from alcoholism;

• being intoxicated (as determined by the laws governing the operation of motor vehicles in the jurisdiction where loss occurs) or under the influence of an illegal substance or a narcotic (except for narcotics used as prescribed to the insured person by a physician);

• committing or attempting to commit a felony;

• being incarcerated in a penal institution or government detention facility;

• engaging in an illegal occupation;

• intentionally self-inflicting an injury; or

• committing or attempting to commit suicide, while sane or insane.

Policy Form No. I H1820 underwritten by Assurity Life Insurance Company, Lincoln, NE.

IMPORTANT NOTICE— CRITICAL ILLNESS INSURANCE PROVIDES LIMITED BENEFIT COVERAGE. It is not a comprehensive major medical plan or Medicare supplement policy and does not satisfy the requirement for minimum essential coverage under the Affordable Care Act (ACA). It is not a substitute for major medical insurance and may not be appropriate for Medicaid recipients.

This policy may contain reductions of benefits, limitations and exclusions. Click here for standard Limitations and Exclusions. Product availability, features, rates, limitations and exclusions may vary by state. The state specific policy form is the ultimate authority for any questions about this product.

*In some states, diagnosis of cancer during the first 30 days following the policy’s issue date results in a significant benefit reduction or policy cancellation. The percentage benefit amount payable for invasive and non-invasive cancer combined cannot exceed 100%.

**Heart attack does not include established (old) myocardial infarction occurring prior to the issue date, sudden cardiac arrest, cardiac arrest or cardiopulmonary arrest.

Assurity reserves the right to order, at the company’s expense, evidence of insurability which the company feels is necessary for the prudent evaluation of the risk.

Assurity is a marketing name for the mutual holding company Assurity Group, Inc. and its subsidiaries. Those subsidiaries include but are not limited to: Assurity Life Insurance Company and Assurity Life Insurance Company of New York. Insurance products and services are offered by Assurity Life Insurance Company in all states except New York. In New York, insurance products and services are offered by Assurity Life Insurance Company of New York, Albany, NY. Product availability, features and rates may vary by state.