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Term life InsuranceJuly 29, 2020

What is the difference between terminal illness and critical illness?

How Terminal illness and Critical illness is different from each other? This question must have crossed your mind when you plan to buy term life insurance online or while availing health insurance. Although both the terms sound related to each other, there are quite significant differences between them. And it is essential to understand the difference between terminal illness and critical illness to choose the right term policy for yourself based on your requirements.

What is the difference between terminal illness and critical illness

What is meant by a Terminal Illness?

Terminal illness refers to life-threatening diseases that are incurable and could be the reason for the patient’s death. These illnesses are seen to be increasing at a rapid pace, especially in the urban cities leading to a low life expectancy rate. In such a condition, terminal illness cover becomes useful as it offers the sum assured and an additional amount after the demise of the policyholder. In some cases, insurers pay up to 25 percent of the insurance coverage amount to the insured person if his or her life expectancy is presumed to be less than 12 months. However, the death benefit in these cases gets reduced to an equal amount that has been already paid to the policyholder’s treatment.

In case you opt to buy health insurance, your insurance provider will pay for your treatment costs as per your coverage. But if you buy a customized terminal illness cover, the benefit is usually high, and you can avail the benefit as lump-sum or instalments depending on the seriousness of the patient’s condition. The benefit amount is paid either on the diagnosis or death of the policyholder due to terminal illness. To make a claim, you must submit all the reports and treatment details in the form of a certificate issued by a doctor.

What is Critical Illness?

Critical illness refers to severe disease but curable with the help of intensive medical treatment. But a critical illness can be life-threatening as well and thus its treatment is usually expensive. Some of the common critical ailments are cancer, heart attack, stroke, blindness, paralysis, organ transplant, etc. 

However, in the case of health insurance policies, the insured person gets financial assistance only when he or she gets hospitalized. In such a case, the claim needs to be valid, and the policyholder does not exceed the insurance coverage limit. But in case of critical illness covers the policyholder receives a one-time benefit, especially when the treatment cost is very high. Once you availed, you can’t get any more benefit till the policy is renewed again.

Benefits offered by terminal illness cover and critical illness cover

Terminal Illness cover Critical Illness cover
The policyholder’s family receives death benefit after his or her demise and hence do not have to face a financial crisis. It gives one-time financial benefit to help you with the treatment.

The insured person can avail at least 25 percent of the coverage amount for his or her treatment.

In critical illness cover, the benefit can be claimed when the insured person is hospitalised or if you have overdue debts or you have lost your income because of critical illness.

Who should take Terminal illness cover?

Those individuals who are suffering from a terminal ailment, like cancer, brain tumour, severe burns, coma, major organ failure etc. should opt for terminal illness cover. These diseases are majorly incurable, and the chances of getting cured are minimum. Therefore, it is better to take a terminal illness cover to be assured that your family is financially secured in your absence.

Who should take Critical illness cover? 

Critical illnesses like heart attack, stroke, blindness, organ transplant and so forth are expanding at an alarming rate. Subsequently, almost everyone should opt for critical illness cover as it will assist you with covering the budgetary expense of the treatment if in case you get diagnosed with such disease in the future.

Therefore, if you are thinking about purchasing an insurance policy or plan to review your existing one, then it is imperative for you to know the difference between terminal illness and critical illnessAfter knowing the difference between both, you can undoubtedly figure out which will be increasingly appropriate for you and which one you should pick according to your need. Both these alternatives can give you significant advantages at various phases of life; it depends upon you to select which spread would be perfect for you to accomplish your financial objectives. In case you want to know more about the difference between terminal illness and critical illnessvisit BimaKaro and speak to their experts. Try to understand both, analyse and then you can either buy term insurance policy online or health insurance.

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