Impact Of Critical Illness Insurance On Financial Planning
Life introduces you to surprises and shocks alike. While there are going to be pleasant things happening around and in your life, there will also be times that bring tears and difficulties. But we live in a world that does not free us from financial responsibilities even in those times.
Buying an insurance policy is one of the best and most crucial decisions you will make in your life. In this regard, having life insurance is a sign of awareness. Moreover, buying a critical illness insurance policy is a sign of precaution.
Being ready for any bouncer life throws at you is an essential part of life and financial planning. When it comes to a health insurance policy, it is a safety pact for unforeseen circumstances.
Also, having insurance, critical illness insurance at that, will show its effects on your life. It affects your personal life, medical life, and financial planning all at once. Let us look at how critical illness insurance affects your financial planning along with other aspects of your life.
Critical Illnesses
Every life insurance company has a list of critical illnesses that they provide you with at the time of signing the policy papers. Listed below are the few commonly found illnesses in those lists.
- Cancer
- Organ failure
- Paralysis
- Heart Attacks
- Stroke
- Brain Tumour
- Alzheimer’s disease
- Parkinson’s disease
- Loss of speech
- Blindness
- Motor neuron illnesses
- Major degree of burns
Impact of Critical Illness Insurance on Financial Planning
- Provides Basic Healthcare Precaution
Critical illnesses’ procedures, treatments, and medicines can get really expensive. It is practically not possible to collect that much amount of money at the time of diagnosis, especially if you are from the upper-middle, middle, or lower-middle-class population.
Critical illness policies are a lifesaver in such cases. Once you are diagnosed with a critical illness, the company will pay you a lump sum payment. This is an important factor because the financial consequences of these illnesses are critical, too. To help you cope with the changing financial conditions, this insurance policy provides financial safety.
- Financial Stability for the Family
There is a chance that the person affected by this severe illness in question is one of the breadwinners or the only breadwinner of the family.
In this case, the family is already suffering emotionally, but with the breadwinner being bedridden, they will face financial strains, too. The critical illness insurance policy will safeguard your family from these financial difficulties with the mitigation of finances.
- Flexibility and Adaptability
The lump sum payment that the policyholders receive is theirs to use and distribute. It is a flexible source of money and helps with its adaptability. Every policyholder has different and unique financial needs.
An insurance company cannot decide where the money will be spent and in what proportion. Hence, this is a really helpful way of providing financial help.
- Acts like Income Replacement
A critical illness makes many changes in one’s life. A person can lose their job due to the physical inability to work or be present at the office. Many critical illnesses, like paralysis, blindness, loss of speech, tumours, etc., can affect your physical as well as mental health in a way that you need time to cope with those and learn how to live with them.
A critical illness insurance policy helps you in these cases. It works like your monthly income when you lose your job so that you can still buy groceries and pay your rent.
- Rising Healthcare Cost
Financial planning usually consists of healthcare emergencies like accidents and critical illnesses. But sometimes, inflation affects the prices of treatment and medicines, but groceries and bills, too.
So, to compensate for all of these, critical illness insurance proves to be beneficial. It provides you with the peace of mind you need and reduces the financial burden on your shoulders.
Conclusion
Everyone wants financial stability; rather, everyone needs it. But seldom do people work towards getting it. Financial planning that does not consider medical emergencies is incomplete financial planning.
Having a health insurance policy in your financial planning is a necessity. At the same time, having a critical illness insurance policy is a precautionary awareness that shapes your financial planning with precision. Do not miss out on it, and be careful!