I have been saying to many friends and clients that critical illness insurance is not only the MOST important part of your financial plan, life and insurances but the HARDEST type to get. The reason for this is that it's the insurance company knows you are most likely to claim on. So take a minute and list out all the types of insurance you have and pay for - I will help you.
1. Car/boat/motorcycle insurance - you have no choice right?
2. House insurance - if you have a flood ya better have it.
3. Life insurance - you have a financial commitment to your families well being whether you are here or not.
4. Fire and theft - nuff said
5. Disability/Critical Illness - most people have the other 4 but do not have anything to cover themselves unless their employer is kind enough to provide it, WCB (as if that's reliable) or EI (because 15 weeks of income is good enough right?) - YOU ARE YOUR BIGGEST asset, without you none of the other insurances get paid, no food on the table, and certainly no big screen TV or trips to Maui.
Interestingly enough the last one is the where the most claims are made however it is where people seem to think "I'll be ok." If you are sensing a bit of a sarcastic undertone to this it's because I am blown away by this everyday - the lack of understanding people have for their own human frailty. We are not invincible - Superman fell off a horse and is a quadriplegic people!
So the point of this entry today is because I have been saying for the past 4 years that Critical Illness insurance prices will increase (not for people who already own policies though) due to the fact that they are claimed upon so much. The insurance company has reassessed the risk and because the risk is so huge they have to charge people more to have this type of coverage.
It's not too late, this first price increase is not enormous, but there will be more as the incidence of illness and survival increases. Due to our life style, both internal and external we increase our chances of getting sick but also because of medical advances, holistic options and our determination to live healthier more aware lifestyles we are very likely to live through it with but with an altered quality of life. Critical Illness policies were not created by an insurance company - but by Marius Barnard, in 1983 the first cardiologist to do a human to human heart transplant. He found that he was giving people back their lives but they could not go back to living them because they had exhausted all financial resources during their illness. Rock meet hard place. "Barnard argued that, as a medical doctor, he can repair a man physically, but only insurers can repair a patient's finances.[7] On 6 October 1983 the first critical illness insurance policy was launched"
This planning tool is one that touches close to my heart. I have lost many friends since diving into this career choice and each time I find out someone is critical ill I wish I could be the one to show up at their door with a big fat cheque instead of scrounging to bid on Canucks tickets at a benefit, which of course I would do - and I don't even watch hockey. Don't put your freedom in the hands of someone who hasn't planned for your sickness. No one has an account that is called "the if Grace got sick account" we don't even have this for ourselves.
We have all lost someone we love and if you had $100,000 to give to them to help them choose their treatments, pay off financial obligations which would eliminate more stress in an already extremely stressful situation - wouldn't you? So if you would do that for someone you love, if you could, why wouldn't you do it for yourself?
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