Critical Illness insurance Flashcards
(27 cards)
True or false critical illness insurance enables individuals who diagnosed with critical illness to receive monthly payments to help them better manage the financial and human consequences of their condition
That all true, except for the monthly benefit, it is usually a lump sum, and therefore just once
True or false : a critical illness is a terminal condition?
False, not necessarily
What is the critical illness insurance for?
It helps individuals who are diagnosed with a critical illness to better manage the financial and human consequences of their condition
The loss of income that resolves from critical illness and increasing healthcare cost are both important reasons for purchasing this type of coverage
Can you buy critical illness insurance if you already have a critical illness?
Usually no. You could if the critical illness that you have is not one of the illnesses covered with the plan. For example, if the plan only covers the big four, and you have another different one, you may still purchase this insurance.
What are the big four critical illnesses?
Cancer, heart disease, stroke, bypass surgery
Do you need to disclose previous illnesses if they are not part of the big four, when applying for critical illness insurance?
The insured must always disclose previous illnesses, in case they do affect premiums or exclusions, because omitting information can be considered misrepresentation, and at worst, could the loss of a license of your agent
What is the point of critical illness insurance?
Critical insurance provides benefits to injured people whether they are able to work or not. The point is to cover costs related to critical illness.
What is premium reimbursement upon death clause?
This clause provides for the reimbursement of premiums, if the insured person dies before the end of the elimination Period.
How long is the elimination period for the critical illness big four?
Usually 30 days, except cancer, which is 60 days.
For critical illness insurance, when is the first benefit paid?
First of all, usually the benefit is a lump sum.
The benefit is paid after the elimination period has passed.
What is the maximum benefit of critical illness insurance?
The maximum benefit is based on the injured persons income. Critical illness insurance coverage pays an amount that is a multiple of the insured persons wages. The maximum amount may exceed $1 million.
Can critical illness insurance be used as a disability buyout coverage? If so, how does that affect the benefit paid?
Obviously, yes, based on the fact that the question asked for a clarification ha ha
The highest benefit amount will be the market value value value of the insured persons share of the business
Insured persons who own more than 10% of the business must have coverage in proportion to their share in the business
John has a personal critical illness insurance plan of $100,000 coverage. He also owns 50% of the shares of ABC Inc. worth $200,000, and has critical illness insurance on that business. how much is his total critical illness insurance?
If John is diagnosed with a critical illness, he will receive $100,000 from his personal plan and $100,000 on the business. That is a total of $200,000.
What are the main factors considered to ensure an individual against critical illness?
The main factors include health condition, medical, history, family, history, lifestyle, profession, and financial situation
What does it mean to survive the elimination period?
The elimination period before the lump sum benefit is received, is usually 14 to 30 days. To receive the benefit, the insured person must survive the elimination period. AKA he must not die.
In some contracts, the insured is entitled to a percentage of the lump sum as soon as the doctors diagnosed is received, even if the elimination period has not expired.
What does free use of benefit mean?
Insured persons may use the lump sum benefit from the insurer for whatever purpose they see fit
Does critical illness insurance require an additional clause to include free use of benefit
Free use of benefit is included in critical illness insurance. It means that the insured persons may use the lump sum benefit for whatever purpose they see fit.
With critical illness insurance, could you get optional coverage?
Of course!
Among the optional coverage used to supplement basic critical illness insurance, two in particular are offered most frequently
- Premium reimbursement.
- Waiver of premiums.
What is premium reimbursement and what kind of insurance is it applied to?
Since we are in the critical illness module, it refers to premium reimbursement When critical illness benefit is not paid.
Technically, it can be added to multiple types of insurance, especially disability, accident, and sickness insurance policies.
Premium reimbursement is when premiums paid can be refunded
- At age 75, if a critical illness insurance contract has been bought until age 75 and no claim has been made
- Upon the death of the insured person, if it occurs before the end of the elimination period
- Upon the death of the insured person if it occurs after the end of the elimination. And the insured person has not made any critical illness claims.
For supplemental critical illness insurance in the case of premium reimbursement (rider) when can the premiums paid be refunded?
- At age 75, if a critical illness insurance contract has been bought until age 75 and no claim has been made
- Upon the death of the insured person, if it occurs before the end of the elimination period
- Upon the death of the insured person if it occurs after the end of the elimination. And the insured person has not made any critical illness claims.
What is waiver of premiums optional coverage for critical illness insurance?
Waiver of premium coverage allows policyholders to stop paying premiums if they become disabled
Is coronary artery bypass a critical illness?
Yes, coronary artery bypass refers to surgery required to correct the narrowing or blockage of one or more coronary arteries. The definition does not include laser correction of a blocked artery.
Is heart bypass surgery a critical illness?
Heart bypass surgery and coronary artery bypass referred to the same critical illness
How is cancer defined?
For the insurer, cancer is defined as the invasion of tissue, spread of malignant cells, and uncontrolled growth of a tumor.
