Buying insurance for critical illness is equally important as health insurance. Though health insurance covers everything related to health but usually the cover is adequate only for covering hospital expenses, In case of any critical illness, the treatment usually go long and people needs to spend much higher than estimates, thanks to escalating cost of treatments these days.  One needs extra insurance for life-threatening ailments while you have a comprehensive health plan and, maybe, a group covers from your employer.


Need of Critical Illness Policy
It is a health policy in which diagnosis of any critical illnesses, one gets the full sum insured irrespective of whether one is hospitalised or not or what the treatment expenses are. The lump sum that one gets can be used for various purposes such as to pay for expensive treatments or recuperation aids, make up for loss of income due to fall in the ability to earn or pay off debts.
Critical Illness polices are restricted in coverage. It covers around 6 to 12 diseases. However, the critical ailments covered under the policy differ from insurer to insurer. It usually covers critical illnesses such as cancer, heart attack, paralysis, kidney failure, coronary artery surgery, renal failure, aorta surgery, stroke, multiple sclerosis, major organ transplant diagnosed after buying the policy. It also takes care of circumstances not covered under a health insurance such as post-operative care, temporary loss of pay, travel, and boarding. It is important to note that this plan strictly adheres to the conditions laid in the policy wordings and offers cover under the specific ailments mentioned in it.
Waiting Period
Critical illness policies have a waiting period of 3 months i.e. there is no cover for those diagnosed with any critical illness during the first 3 months of buying the plan.
The cover is generally not allowed if the insured individual expires within 30 days of the illness being diagnosed.
Who should buy the policy?
It is advisable to buy a critical illness cover after you cross 35 or earlier if there is a history of critical illness in your family. It is an excellent financial cushion when you are diagnosed with a critical illness.
How much cover required?
A combination of comprehensive health insurance and critical illness cover can give a good balance between pricing and coverage. Buy a nice 5-10 lakh critical illness plan, which covers maximum no. of ailments, especially for the earning members of the family according to their income/ area of residential.
These policies are provided both by general insurance companies and life insurance companies, the latter as riders to a life insurance policy that you take from them. It gets also advantage of availing tax benefits under section 80D by investing in a critical illness plan.
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Suresh Kumar Narula

SEBI Investment Advisor, Founder & Principal Financial Planner at Prudent Financial Planners
Suresh K Narula is founder and Principal Financial Planner at Prudent Financial Planners. He has earned the professional CERITIFIED FINANCIAL PLANNER and got registered with SEBI as Investment Advisor. He writes on personal and financial planning articles and got published in Dainik Bhaskar, Business Bhaskar and The Financial Planner's Guild, India. He is also a member of Financial Planner's Guild India ( An association of practicing SEBI registered Investment advisers) to create awareness about Financial Planning in general public, promote professional excellence and ensure high quality practice standards. Suresh received his an from Himachal Pardesh University and an MFC from Punjab University, Chandigarh. He can be reached at
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