Critical Illness Recovery Plan
You may have insured your LIFE BUT, have you insured your LIVING?
Life insurance is essential, but have you ever considered why there are over 100 physicians for every undertaker?
Statistics show that Canadians are living longer. As they do, there is a higher potential to be affected by a serious illness or injury. More and more people are suffering serious illness at progressively younger ages.
Statistics also show that the Canadian health care consumer is faced with rising health care costs, increased waiting time for treatment and limited availability of appropriate medical services.
Of 10 healthy male adults, 3 will suffer a critical illness before age 65, and of 10 healthy female adults, 2.7 will suffer a critical illness before age 65.
Each year 250,000 Canadians suffer from one of the Big 3 (Heart Attack, Cancer and Stroke).
One in three will contract life-threatening cancer during their lifetime. Incidences in Canada have increased 54% since 1984.
With Canadians experiencing over 75,000 heart attacks per year, one in four will contract heart disease during their lifetime.
The good news is that 90-95% of heart attack victims survive their first attack but, what about their finances?
What does this all mean to you? If you suffer a critical illness, you may also have to bear substantial unexpected expenses relating to your recovery and lifestyle changes. These extra costs could include:
- Seeking alternative/ faster medical treatment;
- Providing nursing care in your home;
- Providing childcare or household assistance;
- Paying off a mortgage, loan or other debt;
- Buying a wheelchair or mobility device;
- Modifying your home or car.
The solution is a Critical Illness Recovery Plan (CI). Unlike life insurance, CI is a ‘Living Benefit’ solution that pays a lump sum to the insured after diagnosis.
This coverage is designed to improve the quality of life of the insured while they are alive. With CI, usually 18 to 22 life- threatening conditions are covered.
If you survive for 30 days after your diagnosis of a covered condition, you receive a lump sum equal to the face amount of the policy to be used in any manner you see fit. Any payment received from your CI coverage is, at present, received ‘TAX FREE.’
Facing a critical illness can be one of life’s most difficult challenges. In addition to finding proper medical care, meeting your family’s day-to-day needs, dealing with the fear and anxiety of the illness itself, the last thing you need to worry about are your finances.
A six-month critical illness, without income, will use up 10 years of savings.
Critical Illness coverage, in many cases, is utilized as ‘Income Replacement’ coverage. When a critical illness occurs, a working individual may lose or give up their job to seek treatment. Not only are they dealing with a life-threatening condition, but they could also be dealing with the realities of a loss of their livelihood and their income. Without CI, where does the money come from to sustain your family for one, two or more years?
A properly designed critical illness recovery plan isn’t just about financial help. An array of Assistance Services provides more than a claim cheque. The plan should include Best Doctors (interConsulationTM, FindBestDocTM, Find BestCareTM), Daily Living Assistance, and Healing the Whole Person.
Medical and dental insurance will take care of the doctor, the dentist, the hospital and the pharmacist. Wouldn’t it be wise to take care of your family in case you are ever stricken with a critical illness and can’t work?
A Critical illness plan prevents financial disaster when physical disaster strikes.
Final Note: Living within your income is difficult, but living without your income is impossible.
Visit myfinancialsolutions.ca, my website, for additional financial information on insurance, retirement, estate planning, investments and whole host of other financial topics.
Robert Hughes,
P. Eng., CFSB, CFP, CPCA
