Health insurance is insurance against the risk of incurring medical expenses among individuals. By estimating the overall risk of health care and health system expenses, among a targeted group, an insurer can develop a routine finance structure, such as a monthly premium or payroll tax, to ensure that money is available to pay for the health care benefits specified in the insurance agreement.
A special research paper talking about the incidence of cancer in India was recently published in the Lancet Oncology journal. This research brought forth an alarming statistic, that in India alone, approximately 10 lakh people are diagnosed with cancer each year, of which, almost six-seven lakh people succumb to it. The paper further says that by the year 2035, these numbers may almost double, reaching 17 lakh new cancer patients and about 12 lakh deaths resulting from the disease, each year.
Along with the growing incidence of the disease, what is also exponentially increasing is the cost of cancer treatment, in India and abroad.Comprehensive medical insurance against cancer has therefore become the need of the hour, to offer some relief at least on the financial front.
Despite the fact that most health insurance policies available today usually cover almost all major critical illnesses, inclusive of cancer, these policies mostly pay only for inpatient hospitalisation and only for treatment in hospitals in India. Further, these policies come with various sub-limits on the payable amount in different situations - they may not cover expenses for the entire treatment and the policy amount may not suffice, since the common person usually does not purchase a health policy for over INR five lakhs.
Critical Illness insurance:
A special kind of insurance plan that helps overcome these limitations and covers arange of medical expenses not covered under normal health insurance.
Read Also: Quick Guide on Critical Illness Insurance
Benefits of CI insurance
The core purpose of a CI cover is to assist in paying towards expensive medical treatments, particularly required for certain diseases. The policy pays a lump sum on the diagnosis of any of the ailments listed in the policy document. One can use this amount as per his/her requirement, for recuperation aids, expensive medical treatments, etc. Hospital bills are not mandatory to make a claim.Also, CI insurance,despite offering the option of a bigger cover (between INR 15-50 lakhs) works out cheaper than comprehensive medical insurance plans, mainlybecause it covers only specific critical illnesses.
Disadvantages of CI insurance
However, when it comes to assessing how useful critical insurance plans are to specifically cover cancer treatment and related expenses,one major drawback is that such plans cover cancer only at an advanced stage (they come with a 90-day waiting period). Therefore,the plan would pay only if a malignant tumour exhibits uncontrolled growth, with destruction of normal tissues at a very advanced stage.
Cancer care plans
Some of the shortcomings of critical illness insurance plans are addressed by cancer insurance - a dedicated cancer care product.
Cancer insurance can be called a special type of critical illness policy. Generally, a cancer-specific insurance policy provides substantial cover for a whole range of costs associated with the diagnosis and treatment of cancer, including hospitalisation, chemotherapy, radiation, surgery, etc.
Comprehensive cancer insurance policies cover most types of cancer, at early as well as advanced stages. Some common forms of cancer covered by these insurance plans include:
These plans pay out money at minor as well as major critical stages of the covered types of cancer diagnosis, ongoing treatment, and surgery.
Skin cancer is usually excluded. Claims are also not payable if the cancer directly or indirectly results from or is contributed to by STDs, HIV, or AIDS. Claims are also not payable towards any cancer resulting from pre-existing medical conditions, congenital conditions, and biological, nuclear, or chemical contamination.
How the plan works
If the policyholder gets diagnosed with a cancer of defined severity, a certain percentage of the sum assured is paid out as a lump sum at that time (subject to applicable limits). While disbursing the cancer benefit, the disease is divided into different stages as per severity. The payout varies as per the cancer stage and any claims previously admitted under the same policy. Some insurance policies also offer free regular cancer check-ups through the entire duration of the policy’s term.
Features and benefits of cancer-specific insurance plans
For most cancer-specific policies, 18 years is the minimum entry age and the maximum is 65 years. Renewability of the policy after the policyholder crosses 65 years varies from policy to policy
Minimum sum assured permitted is INR five lakhs and maximum is INR 50 lakhs
Premium waiver benefit
Some cancer-focused plans offer a premium waiver benefit in certain cases. Here, after approval of the claim under the major stage cancer benefit clause, all future premiums payable towards the policy are waived off for the rest of the policy term. However, these benefits are receivable only if the policyholder regularly pays all due premiums and the policy is in force
Cancer care plans are reasonably priced when measured against the benefits they offer
Premiums paid towards cancer care products qualify for tax benefits under Section 80D of the Income Tax Act.
On the flipside, cancer care products generally do not offer death, maturity or surrender benefits.
Although a dedicated cancer-specific insurance product has its own advantages, industry experts opine that such a product is most beneficial for those falling in the high-risk category – i.e. due to family health history, environmental, lifestyle (smoking/tobacco) or other such contributory reasons,he/she is at a greater risk of developing cancer. In such cases, taking a dedicated cancer insurance policy becomes well worth it.
However, in normal cases, one must remember that cancer is not the only critical and life-threatening disease. Blood pressure, diabetes, heart, liver, lung, kidney-related ailments, etc. are also serious critical illnesses. Therefore, if an individual is not specifically in the high-risk ‘cancer’ category only, it makes sense to purchase a critical illness plan, as it provides broader coverage against a wide range of critical diseases, and at competitive prices.