Cancer Policy vs Critical Illness Policy

I do a fair amount of work in the employee benefits area and these questions come up at almost  every meeting either with the employer or the employee. Should we offer it? Should I buy a policy?

According to the latest study by the Center for Disease Control (CDC), more Americans will have heart disease than some form cancer. Yet here in Huntsville cancer policies are very popular. I wanted to dive into some of the differences and usually the first place to start is cost. This is rather difficult to illustrate until you compare the exact dollars you will pay in premium vs. the actual paid benefit. I believe it makes more sense to cover a multitude of major health risks rather than just one. The other difference is how the benefit is paid out. The most popular cancer policy requires that you file a separate claim for each covered benefit. So, for instance, if you are on chemotherapy and require anti-nausea medication a separate claim must be submitted to claim this benefit. The most popular critical illness policy pays the whole benefit once the diagnosis of cancer has been submitted. That is a lump sum of money given to you to spend in any way that will provide you with the most benefit. One claim, one check to spend the way you see fit.

Many years ago, my mother was diagnosed with breast cancer and required chemotherapy. I was fortunate that my employer at the time granted me a very liberal leave, long before the Family and Medical Leave Act (FMLA) and I could care for my mother when she was having her chemotherapy. It was one of the hardest things I have ever had to do. To make matters worse, my mother was sick constantly from the chemo and there were literally piles of towels and bed sheets that had to be washed every day for 3 weeks. I know that I am not alone with this, nobody cleans the house and kitchen the way your mother does. It distressed her and I felt bad that I just couldn’t keep up and deep clean the way she did. Had she had a critical illness policy, I could have hired a cleaning service to come in and help me out. I know my mom would have felt better knowing her house was being kept as clean as possible.

These insurance policies are all designed to provide you with a monetary benefit that will help with some of the financial pain you experience with a major medical crisis. The difference is how the benefit is paid out. For me, I like to keep things simple. One claim, one check.

Mike