Critical Illness cover – The complete plan to bouncing back stronger from serious illness

Thought leadershipReadSeptember 5, 2023

By Wilson Varghese, General Manager and Director at Zurich in the Middle East

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In many ways, we are fortunate to live and work in the UAE. The country offers us a high standard of living, security, healthcare, great infrastructure and numerous lifestyle opportunities. When the going’s good, there’s plenty to enjoy. A question though – during the good times, are we more like the ant or the grasshopper? There’s simple and timeless advice in that story we heard as children.

When life throws curve balls or googly’s our way, such as unemployment or health issues for example, are we sufficiently prepared to meet these challenges? Thankfully we have tools to combat these uncomfortable realities in full or part. Insurance helps us to smoothen the rough times in our life, enabling us to tackle these challenges effectively and be better prepared. Without them, a single instance of serious illness or disease could be debilitating and have snowballing consequences for our life beyond just health.

It's crucial for us to review our unique personal situations and take time to understand whether we and our families are set up to withstand the financial implications of treating and recovering from serious illness while continuing to adequately manage all our other family commitments that ceaselessly continue. It can be a rather daunting time if we aren’t fully prepared.

Take the example of health which for many of us is an increasing concern and a high priority. In Zurich’s claims experience of the last three years in the region, the average age of a critical illness claimant, someone who suffered a heart attack, stroke, cancer or similar was just 49 years. Put that in perspective - it’s about 11 or 16 years before a conventional retirement age and usually a time when we are in our prime working years, paying off a mortgage, saving up for retirement, higher education and so forth.

During this time, we need to ensure that we can recover fully from our condition but do it in a way that doesn’t deplete our savings or cause us to compromise on our recovery options due to monetary constraints. One of the big misconceptions people have is that critical illness cover and health insurance are the same and that either one or the other is required. And perhaps us insurers are to blame for how we’ve named it! The two are often conflated.

Health insurance and critical illness coverage are not the same!

Health insurance and critical illness cover are complementary and serve different and important purposes. Health insurance re-imburses your medical provider expenses (in part or full) based on your policy coverage upon your receiving the treatment.

Critical Illness insurance on the other hand is a lumpsum payment made to the life insured when diagnosed with the defined critical illness like cancer, heart attack, stroke etc. This lumpsum can be used for medical or non-medical expenses as the claimant determines based on their needs.

A few examples where critical illness claim payments can be used:

  • Post-surgery treatments not covered by health insurance like physiotherapy, professional counselling or alternative medicine.
  • Taking unpaid time off work to focus on mental, emotional and physical recovery
  • Hiring a nurse or additional help at home during rehabilitation
  • Flying in a family member to stay with you
  • Making lifestyle changes based on your condition
  • And if not needed, you could set it aside for future treatment costs as health and life insurance could likely have an exclusion, limitation to coverage and be more expensive for a new policy or a renewal when a serious illness has occurred.

None of these expenses can be covered by health insurance, which serves an important purpose of reimbursing your medical provider for treatment provided. Thankfully in the UAE, health insurance is covered by our employer. 

These costs can be covered without anxiety or guilt that it is taking away from your nest egg or dipping into funds you had set aside for your family. I will not forget the courageous testimony of a claimant who addressed our staff at a recent townhall. This young mother could barely hold back her tears when she recounted how she could pay for her treatment of her brain tumor with her claim money without guilt rather than savings set aside for her son’s educational expenses as a child who was a person of determination. There wasn’t a dry eye in the office. People should not have to make these kinds of trade-offs.

A critical illness is a major life event, and while insurance could never help with the emotional challenges which are people’s personal battles to overcome with the help of a positive mindset, the love and support of your family and friends, your personal belief system among others, it is nonetheless a big anxiety and stress reliever to know that you have the financial resources to take on that challenge bravely while still continuing to manage your commitments.

I’ll admit that it’s not the most exciting of tasks, but evaluating your personal circumstances and getting the adequate life insurance cover including critical illness cover is one the most important things you can do to protect yourself and your loved ones. Most if not all life insurance policies offer this as a rider of optional benefit in the life insurance policies and some offer it as a stand-alone policy too i.e. without the life cover.

3 things you can do to be better prepared

Let’s get a physical: Most health insurance providers pay towards an annual health check. Use it regularly to identify risk factors and take action early, particularly if you have a family history and also at older ages.

Prevention is better than cure: Adopt a healthier lifestyle through increased physical activity incorporated in daily routines, healthier meals adequate sleep etc. There’s plenty of good advice on this so I won’t elaborate here.

Wealth protection is foundational to wealth creation: Seek out a professional financial advisor or if you are self-directed, do the research to understand how much and what type of cover you need. Get the right amount of life insurance protection which includes living benefits such as critical illness, hospitalization, family income benefit etc. based on your specific needs.

Request quotes from a few reputed life insurers if you don’t have one and compare them on their claims payment reputation, customer service and price among others. If you have life insurance already, you may be able to add a critical illness benefit to your existing policy rather than take a new one.

A quote is free, so even if you think that it will be unaffordable or that you may be declined due to your age or current condition, get a quote and then decide rather than assume. I’m confident that most people will be pleasantly surprised on both counts.

Long may your good times continue – and in these times if we are more ‘ant’ upfront, we can enjoy being ‘grasshoppers’ for longer!

This article was published on Gulf News:

All you need to know about critical illness cover in the UAE | Business – Gulf News

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