Critical Illness Insurance
Definition of "Critical illness insurance"
Insurance policy that pays a face amount/ lump sum if the insured is diagnosed with a specified critical illness. This sum is paid directly to the insured regardless of any other sources of income (job-related and non-job-related), expenses incurred (medical and nonmedical), and any other factors. Generally, critical illnesses include stroke, heart attack, cancer that is life threatening, paralysis, deafness, organ transplant requirement, blindness, and kidney failure. Some policies pay a percentage of the face amount, for example 15 to 30%, if a less serious illness occurs or medical procedure such as a coronary bypass must be performed. The illness does not have to result in the disability of the insured (total or partial); the insured still receives the face amount payment. This type of insurance can be purchased as a separate policy or as a rider to a LIFE INSURANCE or DISABILITY INCOME policy. The face amount is not paid if the insured dies within 30 days of being diagnosed with the covered illness and there is usually a WAITING PERIOD before the coverage is in force. This coverage may be purchased on both a personal and business basis.
Popular Insurance Terms
Frequency and severity of accidents resulting from conditions and environment surrounding one's workplace. Occupation is an important underwriting factor when considering an applicant for ...
Expenses and taxes incurred by the insurance company resulting from the normal business activities of the company before the due date of the annual statement. ...
Provision found in juvenile insurance that waives the premiums due on the insured child's policy provided that the payor of the premiums becomes totally disabled or dies before the child ...
Attachment to a property insurance policy to protect the interest of the mortgagee in the mortgaged property. If the property is damaged or destroyed, the mortgagee is indemnified up to his ...
Insurance coverage that protects the exporter (even though the exporter may be in total compliance with the terms and conditions of the contract) in the event a foreign government calls the ...
Maximum amount that an insurance company is obligated to pay all injured parties seeking recourse as the result of the occurrence of an event covered under a liability insurance pol ...
Special type of charitable remainder trust (CRT) under which a designated beneficiary (cannot be a charitable beneficiary) receives an annual fixed income. The grantor of the trust is ...
Individual who is legally responsible for taking care of another individual (s) who is deemed to be incapable of managing his/her own affairs. For example, children under the age of ...
Clause in a life insurance policy that states that once the cash value exceeds the net single premium (based on current interest and mortality rates) required for the policy to become ...
Have a question or comment?
We're here to help.