By Carol Mills

It seems like everyone knows someone who has battled a critical illness like cancer or a heart attack or stroke or has experienced the physical, emotional and financial toll first-hand. 

It’s hard to escape.  Serious, life-threatening illnesses are on the rise. Some 80,000 Canadians died of cancer last year; it was the leading cause of death, accounting for 30 percent of all deaths. And 600,000 Canadians live with heart disease, with 20,000 new cases emerging each year.

What makes it all so much worse is the fact that Canadians, who should be saving their strength for the health battle, are instead distracted by financial pressures. New cancer cases can result in wage losses of over $3 billion annually. A Canadian family with a child diagnosed with cancer accrues as much as $40,000 in debt in the first three months.

Having a level of financial protection is  much like having a life jacket to keep you afloat as you weather the storm. Enter Critical Illness Insurance: an employee benefit that gets paid after a diagnosis is made.

With the ability to be offered through traditional group coverage or as a voluntary benefit, there’s a growing trend by employers to add Critical Illness Insurance to their employer offering as a way to help employees balance out the financial responsibility of higher deductibles.  

Critical Illness Insurance will typically cover 18 to 25 different health conditions, from the most common ones --cancer, heart attack and stroke--to Alzheimer’s, Parkinson’s disease or comas.

The payout is a flat lump sum amount that can range from  $10,000-$100,000+ on a group plan.  An employee can go up to$100,000 as a voluntary benefit.  The benefit does not tie back to a particular expense, like medical costs, but rather is designed to recognize the overall financial burden of a diagnosis of critical illness so it can be used by the employee and family as needed.

Employees can opt for coverage for themselves and/or their dependents on a voluntary plan. Depending on the insurer’s plan, the lump sum is paid upon diagnosis or, more commonly, after the insured individual passes the 30-day survival mark (the “elimination period”) following diagnosis.

Although most plans have a pre-existing condition limitation, some insurers are doing away with that stipulation. In fact, the pre-existing status and the elimination period are the only limitations typically written into critical illness policies. Insurers continue to consider relaxing both of these requirements,

Critical illness insurance should not be confused with short or long term disability insurance, which pays out a proportion of salary when employees are unable to work for medical reasons and requires proof for benefits to continue.  Further, critical illness is a good complement to life insurance as a living benefit – a way to provide a full circle of financial relief for family and loved ones in the event of catastrophic illnesses.

It’s important to have the right guidance on fitting critical illness insurance into your employee benefits program. Contact your HUB International consultant to help you on your way.