Getting diagnosed with a critical illness such as cancer can be a distressing experience for the patient as well as their loved ones. Besides the mental toll, your finances too take a hit. Frequent visits to specialists and constant care come at a heavy cost. There’s a likely possibility that your normal health insurance plan may not be sufficient in the face of such expenses. To ensure that you are secured financially when such illnesses do come, you must insure yourself under specific health insurance policies. There are two insurance policies that you can choose from here - critical illness insurance and cancer insurance.

In case you are wondering which one you should opt for, this article can help you out by providing the relevant information.

Firstly, let’s compare the major features of both these policies.

1. Coverage offered in terms of illnesses

Critical illness insurance - Provides financial protection against a variety of illnesses and procedures. These include illnesses such as cancer, kidney failure, motor neuron disease, multiple sclerosis, end-stage lung failure, brain tumour, and so on. Medical procedures like bone marrow transplant, bypass surgery, and issues like strokes, coma, heart failure, paralysis, and so on are also covered.

Cancer insurance - Provides financial protection against cancer. The coverage depends upon the stage, severity, and type of cancer. Generally, the following types of cancers are covered- breast cancer, cervical cancer, stomach cancer, lung cancer, ovarian cancer.

2. Waiting period

Critical illness insurance- Has a waiting period of around 30 days before the policy gets activated and you get compensation on raising a claim.

Cancer insurance - Has a waiting period of 1-2 years. You will receive coverage under your policy only after this period.

3.Payment of sum insured

Both the policies work on a benefit basis that is you receive lump sum payments when you raise a claim with your insurer instead of reimbursements or cashless treatments.

Critical illness insurance- Once the policyholder is diagnosed with a critical illness, they are eligible to receive a lump sum pay-out of up to Rs 1 crore from the insurer, depending upon the sum insured chosen.

Cancer Insurance - Here the sum insured is given to the policyholder depending on the stage of cancer diagnosed. There are primarily four stages of cancer - Carcinoma in Situ (CIS) or stage 0, early-stage/stage 1, major-stage/ stage 3, and critical stage/stage 4.

If cancer has been diagnosed in the first two stages, then the insurance company pays 10-20% of the sum insured to the diagnosed policyholder. If cancer has been diagnosed in the last two stages, then the policyholder receives the full sum insured from the insurer.

What individual benefits can be gained from each policy?

The major benefit to be gained with a critical illness insurance plan is the lumpsum payments which the policyholder may use for anything they wish.

Cancer insurance offers two primary benefits to the policyholder. Firstly, in case of the earning member of the family getting diagnosed with cancer, the insurer will pay regular lump sum amounts to the family which can act as income replacement. Secondly, the insurance company may wave off the premium if the policyholder’s diagnosis of early-stage cancer has been treated completely and they wish to continue the policy.

Which policy would be best for me?

It depends on what you feel you are more at risk for.

If you feel you are at risk particularly for cancer, then opting for a critical illness insurance plan may not be a wise decision, as most CI plans cover cancer only up to a certain stage. For protection against advanced stages, cancer insurance is the answer.

However, if you feel that you are more likely to contract a major critical illness, then a critical illness insurance plan that covers that/those particular illness/illnesses will be the best option.

One should remember that whether it is cancer or some other critical illness, the causes are not only environmental but also genetic. So, even if you live a healthy lifestyle, there are still chances that you may get affected by a critical illness. People are also under the impression that only those who smoke are susceptible to cancer. However, this is not true, as many non-smokers have been victims of cancer as well.