Does health insurance cover critical illness like Cancer, Heart Attack, and Stroke?

According to the latest Philippine Statistics Agency (PSA) report, heart diseases, stroke, and cancers are the three leading causes of death in the Philippines. So naturally, we would be most interested in getting coverage for these when thinking about getting health insurance. But what makes cancer, heart attack, and stroke different from other diseases that HMO or health insurance can cover?

Cancer, heart attack, and stroke belong to a group of serious illnesses considered by insurance and health companies as critical illnesses. The risk of getting these illnesses can increase with age. More alarmingly, critical illness can strike when you least expect it and treatment is not cheap. 

For example, the cost of chemotherapy per session can start from P20,000 and reach up to P120,000 per cycle, depending on the cancer type. The overall cost can amount anywhere from P120,000 to over P1 million.

It’s highly likely that your average HMO and health insurance can’t cover all of this. In Manulife’s 2020 Health Study, “Understanding Filipino Sentiments Toward Critical Illness,” we found that at least 80% of Filipinos are aware of the cost of critical illnesses, yet more than half feel they’re not financially ready should it occur in their family.

Are you prepared for a critical illness?

The good thing is that most insurance companies provide critical illness insurance coverage for cancer, heart attack, stroke, and more. Critical illness insurance can also cover surgeries like those done for Idiopathic Scoliosis and major organ transplants.

Put simply, you need critical illness insurance to ensure that you have a financial plan to cover medical expenses for the specialized treatment needed in case you get diagnosed with a critical illness. Now here’s the long version:

What is critical illness insurance?

Critical illness insurance is an insurance product that covers the policyholder in the event of becoming seriously ill. The insurance company pays a lump sum cash amount when the insured is diagnosed with a critical illness. It’s as simple as that.

Critical illness insurance offers a degree of financial security, which we all need. These illnesses often incur higher than average medical costs that traditional insurance and HMO may not fully cover. 

How does critical illness insurance work?

There are ways to get coverage for critical illness. You can get a plan that focuses primarily on coverage for critical illnesses, or you can also get critical illness coverage as an added benefit (or rider) to a life or health insurance product. You can also add this coverage to your existing plan. For both cases, you pay premiums to be entitled to the critical illness coverage. The benefit amount depends on the amount of coverage you can purchase as assessed through the underwriting process.

Most of the time, when you get health-related insurance coverage, you will have to go through a medical screening first. This will allow the company to assess your risk of contracting a critical illness and determining what coverage the company can offer you. Certain factors are taken into consideration such as age, gender, family history, past medical history, smoking status, alcohol consumption, and body mass index (BMI). The higher the personal and health risks, the more you need to pay for your premium.

Some insurance companies can waive the health screening requirements, especially if you already have a recently purchased insurance product from the same company.

What illnesses are covered by critical illness insurance?

It depends on the product. An insurance company usually has a list of covered critical illnesses to cover. The covered illnesses and the following information will also be included when you get your policy contract:

1. The definition of each illness covered
2. When and how you qualify for the lump sum benefit
3. Whether there will be a waiting period before receiving the benefit
4. The percentage of the total benefit payable
5. What happens if the illness occurs again

How do I receive my benefit from critical illness insurance?

How you receive your benefit and the amount depends on the terms in your policy contract. The insurer can pay a certain amount per hospitalization and the amount can also vary depending on the type of critical illness.

But normally, you receive the lump sum cash amount after filing for a claim when you get diagnosed with a critical illness. After that, it’s up to you how you will manage the amount to cover for your medical expenses. In some cases, the benefit is paid directly by the insurance company to the hospital. If the hospital bill is more than the coverage amount, the insured must pay the remaining out-of-pocket or through other means.

The bottom line is that the terms will depend on the agreement between the insurance company and the policyholder. It would be best to understand your policy contract before you agree and sign it.

When should I get critical illness insurance?

Ideally, you should get coverage even before you get diagnosed with a critical illness. So, when you need the benefit after you contract the illness, it’s already active. It means you would be able to reap the benefits of investing in critical illness insurance.

As age is a factor in contracting insurance, this can also affect the cost of your coverage. Your premium amount can be lower if you start getting covered earlier in life.

How much is critical illness insurance?

As mentioned earlier, the cost of critical illness varies based on several factors. One thing that makes this type of insurance product appealing to buyers is its potentially lower cost. Nonetheless, the more health conditions are covered in the plan, the higher the premium that you need to pay.

The cost will also differ if you buy the critical illness insurance coverage as a separate insurance product or as an added benefit. The same applies if the policy covers just you or if you will also include coverage for your loved ones.

Do I really need critical illness insurance?

Like other health insurance products, having critical illness insurance prepares you for a medical emergency, except it’s especially focused on the more expensive kind. And emergencies, by definition, are unpredictable. 

In making this decision, you can consider three scenarios:

1. You can get critical illness insurance and go through life without ever getting diagnosed with a critical illness.
2. You can take comfort in the health insurance plan you already have but, in the future, end up taking some money out of your savings because it’s not enough to cover critical illness expenses.
3. You get critical illness insurance and end up using it to pay for your medical expenses in the 9^th year after you get your policy.

If you’re part of the population who will go through scenario 1, congrats! But comparing scenarios 2 and 3, wouldn’t you rather be part of the latter? Critical illness often requires long-term medical care and treatment. The impact on your finances can mean changing your lifestyle, putting on hold plans and other priorities for yourself and your family, and even adding stress.

While you consider these scenarios and information about critical illness, you can also ask yourself the following:

• What is my likelihood of developing a critical illness in the next 3, 5, or 10 years?
• Are other family members at high risk of developing a critical illness?
• What is my family’s history of critical illness? Does cancer run in my family?
• Is my health insurance coverage today enough? What illnesses does it cover?
• Am I ready to touch my savings in case of unexpected medical expenses?

Your answers to these questions will give you a clearer grasp of your present risk factors and financial position. You can also start exploring how Manulife can help you live every day better by securing you for critical illness. Talk to us to find out which critical illness insurance plan will best suit your needs!