Critical Illness Insurance Policies
Insurance is a safety net for many different emergencies. The policyholder pays a sum of money known as the premium, and the insurance company guarantees the policyholder will receive a specific sum of money for medical care.
Critical illness insurance provides the policyholder with financial help when they get a specific illness or disease. For example, a policyholder with cancer can receive a lump sum payment because cancer is one of the covered diseases.
The insurance may be part of a worker's benefits or it may be purchased separately. If purchased separately, then the policyholder must go directly to the insurance company. The policyholder may have to visit a doctor approved by the insurance company to verify the illness. The doctor may require the person to undergo a series of tests.
Once the illness is confirmed, many insurance companies will divide payments into two types. The first type is typically a lump sum. The lump sum is so the person can meet expenses faced as a result of the illness.
The second type of payment is an annuity. This annuity helps the person facing the illness fully meet any ongoing expenses. For example, the person may be unable to work because of their illness. The annuity is designed to help offset loss of income.
The policyholder also must survive a short period of time before they can begin collecting benefits. That time is usually for a week.
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