Taking a Closer Look at Critical Illness Insurance in Canada

By: Updated: November 14, 2016


Some Canadians are opting for critical illness insurance to bridge gaps in their health insurance coverage. Is it worth the cost?


Critical illness insurance pays a tax-free lump sum, usually about 30 days after an initial diagnosis, and you can use the funds as you wish, whether that’s to make mortgage payments, pay other bills or for medical treatment, or child care expenses.

However, many people tend to underestimate the financial impact of a critical illness; Canadians tend to think that their provincial health care plan will cover whatever treatment they need. The trouble is that there’s usually a waiting list.

Imagine that you have cancer and you’re told that you need chemotherapy right away but the wait is about four weeks in Ontario. You could have the treatment tomorrow in Buffalo but it will cost you $40,000. Critical illness insurance could pay for that.

In the meantime, you’re not working and your partner is also taking time away from work to take you to medical appointments. That means your bills are piling up.

Having the ability to put the financial considerations to the side is enough reason on its own to buy critical illness insurance.

Then there’s the financial impact of your recovery time. Who wants to rush back to work after a life-changing illness?  When you are trying to recover from something like that, the last thing you need is additional financial stress.

Consider, for example, the chance of a 40-year-old having a heart attack or getting cancer before age 65 is four times higher than the possibility of he or she dying before 65. 

There are a few ways to acquire critical illness insurance. For instance, many Canadians receive group insurance through their employer that includes a form of critical illness coverage. As such, some individuals believe that they are fully covered in the unfortunate event they are stricken by a serious illness. However, group insurance is generally very restrictive and does not provide enough coverage; Canadians are strongly advised to speak to an insurance advisor to acquire an individual plan that will provide adequate coverage and protection.

Upon taking a closer look at critical illness insurance in Canada, it becomes clear that it is worthwhile.

One thing to keep in mind when buying a policy, is to make sure that you disclose any pre-existing health conditions, or you may have difficulties in collecting on a claim.

Related Reading: What to Know When Making a Critical Insurance Claim

Interested in learning more about Critical Illness Insurance and how it can protect you and your family? Download our free ebook: The Beginner's Guide to Critical Illness Insurance.

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