Even the most well-thought-out plans don’t always end up working out like we think they will—that’s why it’s important to prepare accordingly. Have you ever seen a heist movie where they got away with the cash without any complications?
The real complications that all too often get thrown into our lives are terminal illnesses. While living as healthy as possible can and does help, an additional preparation piece to think about is life insurance for terminal illnesses.
Wait, can you even get life insurance with a terminal illness?
Getting Life Insurance With a Terminal Illness
The short answer that comes as a relief to many: yes, you can get life insurance if you have a terminal illness. However, because of the nature of your illness, there are only going to be a handful of policies that can cover you.
Guaranteed life insurance, a type of permanent life insurance that doesn’t require any medical information is one of these options. However, you’re often only covered if you’re under 74-80 years old (depending on the insurance provider). Guaranteed life insurance also has higher premiums, and generally includes a 2-year waiting period on making a claim.
Prepare With Critical Illness Insurance
Prepare With Critical Illness InsuranceAccording to a Canadian Cancer Society Advisory Committee on Cancer Statistics report, 1 in 2 men and 1 in 2.2 women will get some form of cancer in their lifetime.
Cancer treatments aren’t cheap, but life insurance companies will offer a payout for terminal illnesses. Thus, one of the best ways you can prepare and be financially ready in case the worse happens is getting critical illness insurance.
Critical illness insurance will provide additional financial support for people who are diagnosed with cancer or experience a heart attack, stroke, or other serious diseases.
In terms of the coronavirus, you won’t get a payout from a positive COVID-19 diagnosis, but you will get a payout if you have a claim (like a lung transplant) that can be attributed back to the coronavirus.
What to do With a Critical Illness Insurance Payout
Some of the main things we recommend using your critical illness insurance payout for include:
- Paying for medical and wellness expenses not covered by your provincial healthcare plan
- Supplementing your household income if your partner needs to take time off to support you or any children you may have
- Seeking alternative care or out-of-country treatment
Whether you need money to pay for uncovered medication, treatment down south, spousal time-off work, etc., critical illness insurance is a tax-free lump sum, usually payable 30 days after diagnosis, to use as you see fit.
How Much Critical Illness Insurance Do I Need?
How Much Critical Illness Insurance Do I Need?How much is “enough”? There really is no “right” answer—just a reasonable one.
We’ve all heard stories about how cancer has affected families and their finances. Maybe the insured person could no longer work full time, a spouse needed to stop working, there’s an experimental drug not covered by pharmacare that costs $1,000 per week, or maybe the house needs to be renovated for a wheelchair.
The point is the less financial stress you have the more focus and energy there can be used on healing.
Typically, the best amount for most people is a mix of the expected need for a treatment expense fund and a personal or spousal income replacement fund (usually 3 to 6 months of after-tax income).
Overall, you can protect the future of yourself and your loved ones by investing in critical illness insurance. You deserve to spend less time in a hospital worrying about your finances, and more time with your family in your best health.