Critical illness is nothing that we’d like to face at any point in our lives. Because the possibility of developing an illness can never be eradicated entirely, it is important that one takes precautions.
Only then, one is able to make key financial decisions. Taking on the suitable insurance plan now – while you are healthy – is one of the ways to make up for some of the unexpected costs that might be brought about by a critical illness. And that is the reason why there are half a million such policies active in Canada.
Life-and-death conditions are but a slice of the story. Even if one exceeds the originally estimated elimination period, the insurance company may take time to review the claim. One of the measures taken, for example, is to validate whether the insured knew of the illness at the time of application.
The latest news is that a few Critical Illness insurers in Canada bring forward an automatic increase benefit rider. This rider works to augment the policy’s critical illness insurance benefit at scheduled intervals. These automatic increases also mean that the monthly premiums in accordance with the benefit increase.
RBC Insurance, for one, offers its clients a biannual Automatic Increase Benefit Rider. This rider provides the insured with an opportunity to add to her or his benefit every second insurance policy anniversary until the rider terminates.
What is more, during the initial ten years of the policy, the insured person can boost their benefit amount without having to provide additional proof of his or her insurability. The amount is going to be equal to 20% of the originally agreed-upon policy benefit. This means the actual coverage can increase by 100% this way.
One caveat: RBC automatic increases may not be deferred or missed. In case the customer declines an increase, the add-on automatically terminates. Though, previous increases and corresponding increased premiums will still be in effect.
Speaking of inter-insurer variances Canada Life draws a distinction between cigar and pipe smokers in that they classify cigar and pipe smokers as if they were non-smokers for the purposes of critical illness and disability plans. This fact has a great potential to cut down the total price.