The A to Z of Critical Illness Insurance

Caroline Arbour | Journalist

Desjardins Group Insurance advisor Patrick Bouchard answers consumer FAQs on Critical Illness Insurance.

1. What is it?

Critical Illness Insurance pays a non-taxable lump-sum benefit following a diagnosis of a covered critical illness1 such as cancer, stroke and heart disease, which are among the most frequent.

2. How does it work?

You can use your benefit as you see fit, based on your needs and priorities:

  • Replace loss of income
  • Retrofit your home
  • Make up for lost income if your spouse takes time off work to be with you
  • Cover added costs incurred during illness and recovery
  • Travel elsewhere for treatment
  • Pay for medication and healthcare not covered by provincial plans
  • Pay for home care
  • Retire early

3. How does differ from other types of life and health insurance?

Life insurance pays a death benefit to the beneficiaries named in your policy when you die. It helps loved ones pay for death-related expenses and maintain their standard of living External link. Opens in a new window..

Disability insurance External link. Opens in a new window. pays you a monthly benefit when you suffer a disability due to an illness or injury. It helps you meet your financial commitments and pay for disability-related expenses.

Loss of independence coverage pays a tax-free monthly benefit to help pay for specialized care or move to a care facility if you lose your independence External link. Opens in a new window..

4. How are insurance premiums?

Several factors influence premium amounts for critical illness insurance, including:

  • Current state of health
  • Family history
  • Coverage amount
  • The definition of covered and non-covered risks (E.g.: exclusion of existing illness)
  • The type of premium (fixed, variable, life-long or specified period, and refund option)
  • The duration of the policy: does it end when you reach a certain age?
  • Other services, such as a psychological help line

Discuss your needs with your financial security advisor so you can make an informed decision and determine what's right for you.

5. How do I know if I'm eligible?

In most cases, you are required to fill out a questionnaire about your health and family history. A nurse's visit may be necessary, in which you will be asked to fill out a more detailed questionnaire and do a blood test.

The insurer then analyzes your application and decides whether to approve or deny coverage, or change its offer (surcharges, exclusion of pre-existing conditions, etc.).

Speak with your financial security advisor to learn more about critical illness insurance and choose the coverage that suits you best. Make an appointment today.

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1. Based on the illnesses covered in the policy. There are about 30 covered illnesses.