Death and illness are commonly viewed as taboo subjects with most Singaporeans uncomfortable with the discussion of it. "Touch wood!" would be a typical response should one try to broach the topic of falling ill or dying. However, with life expectancy of Singaporeans increasing, it also results in the growing rates of chronic diseases with the average Singaporeans spending eight years in poor health.1 Avoiding the discussion of death and illnesses therefore only result in Singaporeans lacking awareness of the true costs. Additionally, with the majority of Singaporeans unaware about the differences between early critical illness and basic critical illness insurance this could result in an unintended protection gap. In this article, we share the 3 differences you must know about early critical illness and basic critical illness policies.
(See "Can You Survive A $300,000 Medical Bill?")
Critical Illness Policies
There are generally two types of critical illness (CI) policies available: basic critical illness and early critical illness policies. The main difference between the two types of policies is the condition required for payment to commence. For example, early critical illness policies pay out upon the diagnosis of a critical illness. However, basic critical illness policies only commences payment in the intermediate to advanced stage of the critical illness with no payment given in the initial stages of your critical illness.
Additionally, it is important to note that Medishield and critical illness insurance are different and are not meant to be used interchangeably. This is because while Medishield helps to offset hospital-related expenses, critical illness insurance helps with other expenses such as outpatient care, follow up treatments and income replacement during your recovery period.
(See "Comparing Critical Illness Policies")
#1 Coverage
Apart from payments commencing at an earlier stage, early critical illness also provides a more extensive coverage with protection offered for up to 119 medical conditions and/or procedures. On the other hand, basic critical illness policies only insures for the standard definitions of 37 critical illnesses at a severe stage.2
Early critical illness policies also offer additional pay outs for certain specified conditions such as major cancers, heart attack and stroke with the sum assured remaining unaffected by some of these payments. This allows the insured extra pay outs while ensuring that the full amount will be received in the event of a claim.
(See "Term or Whole Life - Which Should You Choose?")
#2 Income replacement
If you are too ill to work, would your savings be sufficient to support your family and yourself? With medical advancement allowing us to detect illness at an earlier stage, this increases the chances of a full recovery but also results in higher medical costs. However, as the majority of Singaporeans only have 20 per cent of the necessary critical illness protection, this shortfall could result in a mountain of debts or the missed opportunities to receive appropriate treatment due to the high costs involved.3
Basic critical illness coverage only pays out upon reaching the intermediate to advanced stage of a critical illness. This leaves a gap where the insured is too ill to work but yet not ill enough to claim from his/her insurance. As such, early critical illness policies seek to address this gap by paying out upon the diagnosis of a critical illness, regardless of its stage. This allows payment to commence earlier thus providing a replacement for your loss of income and allows you to seek treatment without having to worry about the costs.
(See "Want To Retire In Your 50s? Here's The Timeline To Follow")
#3 Ability to remain insured even after a previous critical illness claim
While the option of receiving coverage even after a critical illness claim is unheard of in the past, it is now possible with early critical illness policies.
This is because unlike basic critical illness policies where coverage lapses upon a successful claim, early critical illness policies allow you the option to remain insured despite previous critical illness claims. As the fear of not being able to receive subsequent insurance coverage after a critical illness is one of the top concerns of patients, this provides reassurance by ensuring that you can remain insured.4 Moreover, early critical illness policies allow for multiple claims to be made at the different stages of your illness thus ensuring comprehensive coverage against critical illnesses.
(See "Is Your Coverage Sufficient For Your Secret Sugar Addiction?")
Available Critical Illness Plans |
Manulife - Ready CompleteCare NTUC Income - Cancer Protect,Silver Protect,Silver Secure,Lady 360 Tokio Marine - TM Protect Cancer, TM MultiCare, TM EarlyCover |
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Available Products on FSMOne Insurance |
Term Life, Whole Life, Critical Illness, Annuity, Health, Endowment from Etiqa Insurance, Manulife, NTUC Income and Tokio Marine Life Insurance *Please check with our advisory team if the product you want is available on FSMOne Insurance |
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