What is critical illness insurance?
Unlike life insurance, critical illness coverage provides a living benefit. A unique product, it provides you with a lump-sum payment to help with the cost of recovery should you become critically ill during the term of the policy. Because it's a policy that covers a specified term the rate that you will pay is the same for the entire duration of your coverage.
The history of critical illness insurance
Critical illness insurance was developed by Dr. Marius Barnard in 1983 to offset the financial hardship often experienced by survivors of major illnesses. This hardship - often a result of lost income and unexpected expenses - meant that survivors were using up life savings and RRSPs to keep the lifestyle they enjoyed before becoming ill.
"You need financial independence when you're ill," said Dr. Barnard. "Not because you're going to die, but because you're going to live."
Why you need critical illness insurance
Hundreds of thousands of Canadians suffer and recover from serious illnesses each year.*
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40,000 to 50,000 Canadians yearly have a stroke and 85% survive the initial incident
- 70,000 Canadians yearly have a heart attack and more than 80% of them when admitted to hospital survive
- 1 in 3 women in Canada will develop some form of cancer during their lifetime
- 2 in 5 men in Canada will develop some form of cancer during their lifetime
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The cancer death rate for both men and women has steadily been declining
Consider these addtional statistics and facts about the probability of developing a serious illness:*
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1 in 2 men and 1 in 3 women are predicted to develop heart in disease in their lifetime.
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There are 40,000 to 50,000 strokes in Canada each year.
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During their lifetime:
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1 in 2.4 men and 1 in 2.7 women living in Canada will develop cancer.
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1 in 9 women will develop breast cancer.
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1 in 11 men and 1 in 18 women will develop lung cancer.
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An estimated 2,798 Canadians will be diagnosed with cancer every week.
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An estimated 50,000 Canadians, twice as many women as men, have Multiple Sclerosis.
* Statistics sources: Heart and Stroke Foundation, 2004. 2004 Multiple Sclerosis Society of Canada. National Cancer Institute of Canada: Canadian Cancer Statistics 2004.
What does it all mean? What are your chances of surviving from a critical illness?
Some survival statistics:
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86% of hospitalized heart attack patients survive - the percentage is higher for those with their first heart attack, and lower for those with recurrent heart attacks.
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80% of stroke patients survive the initial event.
Advances in medical science and increasing life expectancies mean you have a better chance of surviving a critical illness. However, a critical illness often brings overwhelming medical and financial burdens on you and your family.
Can you survive financially after an illness? Unless you are a person of vast means, the answer is no. Critical Illness insurance helps you maintain and protect your pre-illness lifestyle through the time it takes for you to recover. Critical illness insurance provides you with a lump-sum payment, when you need it most, to be used any way you see fit. This can mean covering extra health care bills, alternative medicines, business expenses, pay off debts, home renovations or treatment abroad. It also includes having to pay for homecare expenses not covered by a government health insurance plan. Add all of this to your regular household bills, and the financial consequences of surviving a serious illness could add up.
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