In last week's edition, we touched upon various 'Cancer Care' insurance policies available in India today. These policies enable an individual and his family the much needed financial and mental security if/ when battling cancer.

The cost of hospitalisation and medical/health care is rising by the day, making access to it increasingly difficult for the 'common man', especially in case of critical illnesses such as heart attack, coronary artery disease, kidney failure, stroke, etc. A critical illnesses may lead to loss of income, changes in lifestyle, and even permanent disability. At times, the expenses incurred for the treatment of the ailment are so high that it isn't covered under a regular health insurance policy. Under such situations, critical illnesses policies provided by general insurance companies come to one's rescue.

How are Mediclaim and a critical illness policy different from each other?

Particulars	Mediclaim	Critical Illness
Sum Insured (Rs)	5,00,000	5,00,000
Hospitalization Exp (Rs)	3,00,000	3,00,000
Amount paid by the insurance company (Rs)	3,00,000	5,00,000

• A mediclaim is typically an 'indemnity policy' (i.e. it makes good the financial loss), where hospitalization expenses are covered under the policy, subject to the sum insured you've opted for. A critical illness policy on the other hand, provides you with a benefit where the entire amount of sum insured will be paid to you on fulfilling the pre-defined conditions, irrespective of the hospitalization expenses you've incurred. It is unnecessary for the insured to undergo treatment in order to acquire a claim from the insurer and the claim amount is paid irrespective of the cost of treatment. The following example explains this:
   


• A mediclaim covers the treatment of many diseases, but in case of a critical illness policy; the sum insured would be paid once a critical illness (such as Cancer, Coronary Artery Bypass, Surgery, First Heart Attack, Kidney Failure, Major Organ Transplant, Multiple Sclerosis, Stroke Aorta Graft Surgery, Paralysis, Primary Pulmonary Arterial Hypertension, etc. - the list differs from insurer to insurer) is diagnosed. One need not be hospitalised to receive a claim under a critical illness policy. Most insurers provide the entire benefit of the sum insured on diagnosis of the illness. While under a mediclaim policy, the hospitalization expenses will be reimbursed (in the case of non-network hospitals) or a person can benefit a cashless claim (in the case of network hospitals)
   
• The waiting period in a mediclaim policy is 3 months and for a critical illness policy, it is 30 days.
   
• The duration of a critical illness policy is higher in comparison to a mediclaim policy.
   

Here's your checklist to select the best critical illness policy:
 

Parameters	Ideal Solution
Max. Entry Age	The higher the entry age, the better it is; since it gives you the necessary flexibility to purchase the policy at a later stage too.
Renewal Age	The higher the renewal age, the better it is.
Sum Insured	Should be at least 1.5 to 2 times your current gross annual income
Survival period	The claim will be settled after the survival period; so lesser the survival period, the better it is
Tax Benefit	Don't forget to claim Income Tax benefit for the premium paid for the policy
Free look in period	Higher the free look in period, the better it is; it gives you the cushion to return the policy if it doesn't match your expectations.
No. of diseases covered	The policy should extensively cover a wide range of critical illnesses.
Waiting period	The critical illness cover begins after the waiting period is over. So, lesser the period the better it is.
Claim process	Choose an insurer who has a hassle-free claim handling process along with a consistent claim settlement track record. Remember, it's your loved ones who will have to do the running around.
Premium	Premium is the consideration you pay for getting the cover. An extensive cover with low premiums would be better to go for.

(Source: - Websites of respective insurers)

In order to help you find a suitable critical illness policy, we have tried to compare five critical illness policies in our today's edition of "Financial News. Simplified".  

Here are a few critical insurance policies offered by insurers

A Snapshot
Company Name	Apollo Munich	Bajaj Allianz	Max Bupa	Religare	HDFC Ergo
Policy Name	Optima Vital	Critical Illness	Critical Illness	Assure	Critical Illness
Entry Age	18 - 65	Proposer/Spouse: 18 - 65 Dependent Children: 6 - 21	18 - 65	18 - 65	5 - 45 Dependent Children: 5 - 18
Renewal Age	Lifetime4	Lifetime4	Lifetime4	Lifetime4	Lifetime4
Sum Insured	18- 55 years: Rs 1,00,000 to 50,00,000 55 years and above: Rs 1,00,000 to 20,00,000	6 - 60 years: Rs 1,00,000 to Rs 50,00,000 Above 61 years: Rs 1,00,000 to Rs 5,00,000	Rs 3,00,000 to Rs 10,00,000	Rs 5 lakhs to Rs 1 Crore	Rs 2,50,000 to Rs 10,00,000
Survival Period1	Varies from category of disease. Category I & III = 30 days Category II = 90 days Category IV = 6 months	30 days	30 days	Zero day survival period	30 days
Tax Benefit (if any)5	Premiums exempt u/s 80D of the Income Tax Act, 1961	Premiums exempt u/s 80D of the Income Tax Act, 1961	Premiums exempt u/s80 D of the Income Tax Act, 1961	Premiums exempt u/s 80D of the Income Tax Act, 1961	Premiums exempt u/s 80D of the Income Tax Act, 1961
Free look in period	15 days	15 days	15 days	15 days	15 days
Benefit	1) Lump sum pay out irrespective of the actual cost of treatment 2) E- Opinion in case of critical illnesses2	1) Lump sum pay out irrespective of the actual cost of treatment 2) In house claim process	1) Lump sum payout irrespective of the actual cost of treatment 2) In house claim process 3) Critical Illness + Hospital Cash + Personal Accident Cover (flexible combinations)	1) Lump sum payout irrespective of the actual cost of treatment 2) Accidental death cover 3) Second opinion from medical expert 4) Child Education Benefit 5) Zero day survival period 6) Option of adding personal accident policy	1) Lump sum payout irrespective of the actual cost of treatment 2) No medical check upto the age of 45 (depends upon the age & sum insured)
No. of diseases covered	37	10	20	20	8 (silver plan) 15 (platinum plan)
Waiting period	1) 90 days waiting period for all claims from the commencement of the policy 2) 48 months for all pre existing conditions3 declared or accepted at the time of application	1) 90 days waiting period for all claims from the commencement of the policy	1) 90 days waiting period for all claims from the commencement of the policy 2) 48 months for all pre existing conditions3 declared or accepted at the time of application	1) 90 days waiting period for all claims from the commencement of the policy	1) 90 days waiting period for all claims from the commencement of the policy
Notification of claim	Within 14 days of the diagnosis of the first occurrence of the Critical Illness. The intimation can be done through letter, email, fax or telephone	Within 48 hours of the diagnosis of any Critical Illness. The intimation should be done in writing only	Detail unavailable	Within 48 hours of the diagnosis of any Critical Illness. The intimation should be done in writing or at the company's call centre	Within 7 days of discharge The intimation can be given on their toll free number
Documents for filing claim	1) Duly signed claim form 2) Original Discharge Summary 3) Medical certificate confirming the diagnosis/treatment of Critical Illness from medical practitioner 4) A precise diagnosis of the treatment for which a claim is made 5) Treating doctors certificate regarding the duration & etiology 6) MLC/ FIR copy/ certificate regarding abuse of Alcohol/intoxicating agent, in case of Accidental injury 7) KYC documents	1) Duly signed claim form along with NEFT form signed by the claimant 2) Copy of discharge summary / discharge certificate 3) Copy of final hospital bill 4) policy copy 5) First consultation letter for illness 6) Medical certificate for the duration of illness 7) All required Investigation Reports as per the Illness 8) Medical certification from specialist	1) Duly filled and signed claim form 2) Final Hospital Discharge Summary in original / self attested copies if the originals are submitted with another insurer. 3) Final Hospital Bill in original / self attested copies if the originals are submitted with another insurer 4) Original consultation notes and / or investigation reports from outside the hospital prior to hospitalization 5) Copy of First Information Report (FIR) / Panchnama duly attested by the concerned police station (if Critical Illness being claimed for is admissible in event of an Accident) 6) Copy of Medico Legal Certificate duly attested by the concerned hospital. (if Critical Illness being claimed for is admissible in event of an Accident)	In case of accidental injuries:- 1) Duly signed claim form 2) Medical Certificate about the nature and extent of accident resulting injuries 3) Medical Examiner's Report 4) Details of treatment rendered by the attending Doctor/Hospital/Nursing home 5) Certificate from the employer to the effect that the Insured was on leave during the period 6) Fitness certificate In the event of accidental death 1) Post-mortem Report 2) F.I.R./Police Report 3) Punchnama 4) Departmental Inquiry, if any 5) Report of Doctor/Hospital/Nursing Home 6) Death Certificate	1) Duly filled and signed claim form. 2) Photocopy of ID card. 3) A medical certificate confirming the diagnosis of critical illness from a doctor not less qualified than MD/MS. 4) Investigation reports/ other related documents reflecting the critical illness diagnosis. 5) Original detailed discharge summary / day care summary from the hospital.
Premium for Rs 10,00,000 sum insured per annum	Age 30: Rs 3,705 Age 40: Rs 5,750 Age 50: Rs 17,500	Age 30: Rs 3,420 Age 40: Rs 6,270 Age 50: Rs 13,680	Age 30: Rs 2,541 Age 40: Rs 5,317 Age 50: Rs 13,104	Age 30: Rs 3,253 Age 40: Rs 7,313 Age 50: Rs 23,401	Silver Plan - Age 30: Rs 2,850 Age 40: Rs 5,700 Age 50: Rs 13,965 Platinum Plan - Age 30: Rs 3,990 Age 40: Rs 7,980 Age 50: Rs 17,385

(Source: - Websites of respective insurers)

Common Terms explained:
 

1. Survival period: This means the period after an insured event that the insured person has to survive before a claim is payable.
    
2. E -opinion in case of critical illness: Apollo Munich can arrange to pay for a second opinion from their panel of medical practitioners if the insured person suffers a Critical Illness during the Policy Period, and decides to avail this benefit by personal choice.
    
3. Pre-existing conditions: This defines any medical condition, ailment or injury or related condition(s), for which you've had signs or symptoms, and/or have been diagnosed, and/or received medical advice/treatment, within 48 months prior to the first policy issued by the insurer.
   (Keep in mind, the Principle of "Utmost Good Faith" is applicable for all insurance policies)
    
4. Lifetime renewal: The policy shall terminate on the occurrence of the first critical illness and the life insured shall receive the sum insured as per applicable guidelines. The policy shall cease with no subsequent renewals for the insured (changes from company to company). However, the other insured members will continue to be covered under the Policy.
    
5. Tax Benefit: One can also claim benefit u/s 80 DDB under the Income Tax Act, 1961 for specified diseases (such as cancer, neurological diseases and AIDS). However, any amount received from an insurer OR one's employer towards medical reimbursement should be deducted from the maximum claim benefits allowable u/s 80 DDB.
    

Are there any 'exclusions'?

Every critical illness policy would not cover all the critical illnesses. Although the list changes from insurer to insurer, the broad exclusions are as follows:-

• Non medical exclusions:
   
  • War or similar situations
  • Breach of law (including suicide)
  • Dangerous activities (including military exercises and sports)
     
• Medical exclusions:
   
  • Substance abuse and de-addiction programs
  • Congenital internal or external diseases, defects or anomalies, and genetic disorders.
  • Any critical illness coupled with an HIV infection and/or AIDS.
  • Any treatment arising from pregnancy (including voluntary termination), miscarriage, maternity or birth (including caesarean section).  

Conclusion:

The threat of facing a major ailment is ever present considering today's lifestyle that comprises of long working hours, stress, lack of physical exercises, skipping of meals, junk food, alcohol, and smoking. This lifestyle is the primary reason that a critical illness cover is required today.

At PersonalFN, we understand that choosing a critical illness policy can be daunting and so it's prudent to engage the services of a financial planner, who after taking into account a host of factors, could recommend an appropriate critical illness policy with an optimum cover.

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