Critical Illness Supplemental Coverage
Cancer Insurance a Controversial Product
Cancer can strike anyone, regardless of gender, age, or lifestyle. Even athletes in top physical condition can get cancer: Darryl Strawberry and Mario Lemieux, for example. If cancer runs in your family, you might be especially concerned about your risk, and there is insurance sold specifically to cover you if you should get cancer.
Is cancer insurance right for you or would you be better off with a broader Critical Illness Supplement?
Here are a few points to keep in mind when purchasing coverage. What does the policy pay for? Such as surgery, medication, doctors' visits, radiation treatment, and Chemo. Make sure everything is covered. Opinions differ on whether or not cancer insurance is a "good buy." "What people need is major medical coverage that protects them against cancer, getting hit by a truck, and everything else," says Bob Hunter, a spokesperson for the Consumer Federation of America. "They also need disability insurance coverage which covers them when they are out of work because they're sick." Hunter explains that cancer insurance fails one of his two basic tests - tests he feels every consumer should apply to a prospective policy.
The first test: Does the policy cover a major financial catastrophe? Contracting cancer certainly falls into the category of major financial disaster. With multiple doctor visits, the potential for chemotherapy, and the possibility of extended hospital stays, cancer can be very expensive.
The second test: Does the policy provide comprehensive coverage? Cancer insurance fails Hunter's second test. Cancer insurance is just that: for cancer only. It will not cover you for anything else, such as heart disease, stroke, diabetes, or high blood pressure. One in two men and one in three women may contract cancer during the course of their lives, according to the American Cancer Society. This means one in two men and two in three women don't contract cancer.
A multiple catastrophic illness policy that pays a lump sum upon diagnosis might be a better choice. The lump sum can cover a host of expenses that will occur as well as make up for loss of income because the person getting treatment will miss work as well as a spouse may miss work because of the necessity of taking care of the person with the illness.
"Nobody should buy cancer insurance," Hunter concludes. "It is a totally inappropriate way to buy insurance." The Health Insurance Association of America (HIAA) emphasizes that cancer insurance, if purchased, should be viewed as extra coverage on top of what a consumer needs. "Any specialized coverage [such as cancer insurance] is intended to supplement comprehensive health coverage," HIAA spokesperson Richard Coorsh told INN. The American Cancer Society concurs. In its official statement on cancer insurance, it says, "Cancer insurance is supplemental, not a substitute for comprehensive coverage." The American Cancer Society goes on to emphasize the need for consumers to fully understand such a policy before purchasing it. The organization believes that insurance companies bear the responsibility for making the policy terms understandable to consumers by writing it in "clear unequivocal language."
You should consider your family history and lifestyle when deciding to purchase a policy. Even if these factors don't figure in your premiums, they certainly can factor into whether or not you're at risk for cancer or other critical illnesses.
A Critical Illness Policy might be a better alternative.
Critical Choice Plus:
A Benefit Plan for Survivors of Illness. Critical Choice Plus pays a lump-sum benefit upon diagnosis of a critical illness, or upon death from any cause.
Benefit Payments
Heart attack: 100% lump-sum benefit
Stroke: 100% lump-sum benefit
Life-threatening cancer: 100% lump-sum benefit
Paralysis: 100% lump-sum benefit
Alzheimer's disease: 100% lump-sum benefit
Loss of independent existence: 100% lump-sum benefit
Death from any cause: 100% lump-sum benefit
Coronary bypass surgery: 25% lump-sum benefit
Angioplasty: 10% lump-sum benefit
How Critical Choice Plus Works:
Example -- Survives Illness
John Doe - Age 40 - Non-smoker
$100,000 Benefit
1/3/99: Policy issued.
2/20/99: Suffers heart attack and survives.
$100,000 paid to insured.
Policy was in effect over 30 days;
policy was paid upon diagnosis.
Example -- In the Event of Death
John Doe - Age 40 - Non-smoker
$100,000 Benefit
6/1/98: Policy issued.
1/20/99: Dies from auto accident.
$100,000 paid to beneficiary;
due to death from any cause.
Specifications:
Issue Ages: 20 years-65 years
Issue Amount:
Minimum - $10,000
Maximum - $500,000
Medical: Non-medical to age 50 for amounts up to $50,000
Stand-Alone Term: Yes
Re-Entry: Yes; after 15 years prior to age 70
This is a summary of certain features of this product; the product
policy contains complete details.
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product information.