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Critical Illness Cover

How to find cover for serious illnesses, accidents or medical conditions.

Critical illness cover can offer you a lump sum payment to cover medical costs, debts and bills if you develop an illness or condition that’s covered in the policy.

Also known as trauma insurance, critical illness insurance can provide peace of mind if you suffer a serious medical condition such as cancer, heart attack or stroke.

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When am I eligible for a critical illness cover payment?

To be eligible for a critical illness cover payout, your illness or injury must be one that is covered by your policy and while such conditions vary with insurers, the most common are cancer, heart attack, coronary bypass and stroke. It tends to pay out if a person suffers a serious illness that’s non-life threatening.

The condition must also occur after what’s known as the exclusion period.

  • Diagnosis of a covered condition. The conditions covered are listed in the product disclosure statement (PDS) of your policy. You can either receive a full or partial pay-out, depending on the condition.
  • Your diagnosis occurs after the exclusion period. This is typically after 90 days from when you first purchase your policy.
  • You survive the illness through a defined period. This is typically set at two weeks from when you are diagnosed with the illness.

Note: Check your PDS for the specific requirements of your insurer.

What could a pay-out be used for?

A pay-out from a Critical illness cover policy can be used to:

  • Pay remaining medical bills, including out-of-pocket expenses.
  • Rehab, if not already covered by health insurance
  • A holiday to take your mind off things
  • Let you take time off work

Should I buy a standalone critical illness policy, or bundle it with life insurance?

Critical illness cover can be purchased as a standalone product or as part of a plan, often bundled with life insurance and Total Permanent Disability (TPD) insurance. There are advantages and disadvantages to both options.

Bundled critical illness cover

  • Cheaper (save on fees and stamp duty)
  • Less comprehensive cover

Standalone critical illness cover

  • More comprehensive cover
  • Generally more expensive
If your bundled trauma insurance policy doesn’t provide sufficient cover, you might need to consider additional cover options such as Buy Back and Double Trauma benefit to ensure you have adequate trauma protection.

Do all trauma insurance policies cover the same conditions?

Most claims for a critical illness or injury are for either heart attacks, strokes or cancer, but there are others that may vary between insurers. This is why it’s essential you compare your cover, or speak to an adviser about a policy suitable to your needs.

You have two types of policies to choose between when signing up for trauma insurance: a standard policy or comprehensive policy. Most insurers cover the same medical conditions but there is a chance it will vary due to different definitions.

Conditions that are covered

Here’s a list of what’s usually offered under standard and comprehensive policies.

Standard policyComprehensive policy
The cheapest type of policy. It typically covers between 30–44 critical conditions, including the following.
  • Cancer
  • Heart attack
  • Stroke
  • Brain damage
  • Time in intensive care
Offers similar cover to a standard policy, but also provides cover for another 15 conditions. Here are some of them.
  • Melanoma
  • Diabetes complications
  • Partial blindness
  • Partial loss of hearing
  • Carcinoma
  • Osteoporosis

One step you can take to find out what medical conditions are covered by your policy is reading your terms and conditions. This will outline all included costs, benefits and exclusions.

What happens if I’m diagnosed with a critical illness?

You will need to make a claim. Here’s an outline of the process:

To make a trauma insurance claim you’ll generally need to follow this process.

  1. Fill out a claim form. This is completed by you, your doctor and any medical specialists involved. Your treating doctor will need to provide details of your condition and medical history.
  2. Provide identification. This could include a South African passport, birth certificate and a driver licenses.
  3. Provide your original policy documentation. You’ll need to show the original policy you were given or quote the policy number.
  4. Provide any further documents. This might include additional medical reports or investigations.
Will I be paid straight away? No. Your condition will need to be assessed to see if it meets your insurer’s definition and you’ll also need to pass the ‘survival period’ set out by your insurer.

Understanding critical illness cover survival periods

The survival period is the amount of time a policyholder must survive before passing away, in order to receive a critical illness cover payment. Imagine, for example, a policy with a 14-day survival period. If the policyholder suffers serious trauma, is taken to hospital, and dies 12 days later the insurer will not pay out the policy. But if the policyholder passes away after the 14-day survival period (as a result of their injuries or illness) the insurer will grant the payout.

What is the 90-day exclusion period?

Many policies also feature a 90-day exclusion period. This is standard to make sure you don’t just take out trauma cover to make a claim for a condition you know you already have.

Under this exclusion, claims for many insured events will not be paid if the condition occurs or is diagnosed within 90 days of:

  • The start of your policy
  • The date of an applied-for increase in cover (but only in respect of the increase)
  • The most recent date your policy was reinstated

What factors affect the cost of critical illness cover?

How much you pay for critical illness cover, or any kind of life insurance, will be determined by several factors. Your insurer will take into account:

  • Your age. The older you are, the greater the risk you pose to your insurer and the more your premiums will cost.
  • Your gender. Males are typically viewed as higher risk than females and will pay more for their premiums.
  • Your smoking status. Smokers are considered higher risk and can pay up to twice as much for their premiums.
  • Your occupation. If your job is considered high risk (i.e. underground miner), you will pay more for your premiums.
  • Your lifestyle. If you indulge in risky sports or pastimes such as skydiving or rock climbing, your premiums will be higher.
  • Your current health. If you have pre-existing medical conditions you will pay more for your premiums.
  • Your medical history. If you have a family predisposition to certain diseases, you will pay more for your premiums or may not be offered cover.
  • Your level of cover. How much cover you want, which in the case of trauma insurance equates to how many conditions you want to be insured against, will also determine how much your premiums will cost.

How can I save money on my policy?

There are a number of ways you can reduce the cost of your trauma insurance premiums:

  • Give up smoking. stop smoking and after 12 months you’ll halve the cost of your insurance.
  • Change your job. If your hazardous occupation is increasing your premiums, consider moving to a lower risk occupation.
  • Change your hobbies. If your high-risk pastimes are costing you more for your insurance, consider taking up golf instead.
  • Apply while you are young. Take out your policy while you are young and still considered low risk by your insurer.
  • Choose the right premium type. Choose stepped premiums if you want to pay less now and think you’ll be able to pay more later in life or choose level premiums and pay the same amount for the life of the policy.
  • Shop around. Compare insurers and choose the cover that offers you the best value for your money.

Is critical illness cover worth it?

Great, critical illness cover is important. But is it worth your money? What if you already have life insurance in place? Consider the following.

It covers you where other forms of insurance won’t

Critical illness cover can offer cover in areas where life insurance, income protection and disability insurance fall short:

  • Unlike life insurance. Critical illness cover pays out if you survive a critical condition (as opposed to when you die).
  • Unlike disability insurance and income protection. Critical illness cover typically pays out on diagnosis (as opposed to after you prove you are unable to work).
  • Unlike health insurance. Critical illness cover pay-outs can be used however you like (as opposed to being bound to specific medical benefits).

How do I compare critical illness cover quotes?

Trawling for the best critical illness cover quote can be a time-consuming exercise, but it’s critical to do your homework to find the best policy to meet your medical and budget needs.

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