How well do you understand: Critical illness insurance

When was the last time you invited your friends over to look at your cool new insurance policy? Can't remember, can you? Let's face it - an insurance policy with excellent coverage that will provide for your family's needs is a smart investment, but it's not something you're likely to brag about to your co-workers.

It may not be particularly glamourous, but insurance really is good for you. Your goals and plans for the future help determine the types of insurance you need. With major medical advances helping us survive formerly fatal illnesses, many Canadians are looking to critical illness insurance to help make recovery that much easier.

What is critical illness insurance?
Critical illness insurance pays out a lump sum when you suffer from and survive a major ailment as outlined in your policy. OTIP Critical Illness insurance covers 15 different conditions. Unlike life insurance, critical illness insurance is a living benefit - a policy with proceeds you'll be able to spend and use yourself. The lump sum payment is yours to do with as you please. It can be used to pay for treatments in other countries, to modify your home with accessibility features, to bring your family to treatment centres to visit you, or even to pay for a well-needed vacation. You make the decision.

Who needs it?
Critical illness insurance is not just for the elderly. Certain covered conditions can affect you no matter what your age. Choosing critical illness insurance lets you freely plan how you'll live your life after a serious medical incident.

To help you understand what critical illness insurance is and who really benefits from it, take the quiz below.

True or False?

1. You have to be unable to work to collect critical illness insurance.
2. You must submit receipts in order to claim critical illness insurance.
3. I'm not insurable because my close relatives have had heart conditions.
4. People rarely survive heart attacks.
5. 1 in 20 Canadians will develop lung cancer in their lifetime.
6. There are over 2,700 new cases of cancer diagnosed in Canada each week.
7. 40,000 to 50,000 Canadians suffer a stroke each year.
8. The majority of critical illness insurance claimants are seniors.

Learn more about OTIP's Critical Illness insurance plan.

Answers:

1. False - Unlike disability insurance, critical illness insurance pays out whether you can work or not. Your benefit is paid even if you recover from your condition well enough to return to your job.
2. False - You do not have to incur any medical expenses or account for how you use the funds from your critical illness insurance policy.
3. False - OTIP Critical Illness insurance is underwritten without family history. Even if many of the people in your family have suffered heart disease, your eligibility and policy rates are not affected.
4. False - More than 80% of sufferers survive their first heart attack.
5. False - Actually, the odds of developing lung cancer are much higher - 1 in 12 will develop this form of cancer in their lifetime.
6. True - This number is closing in on 3,000 new cancer diagnoses in Canada each week.
7. True - While approximately 40,000 to 50,000 Canadians suffer a stroke each year, over 80% will survive their first stroke event.
8. False - The average female critical illness insurance claimant in Canada is 51.5 years old; the average male claimant is 53.6 years old.

Quiz questions and answers provided by ACE INA Life Insurance.