What is the survival period in a critical illness health cover?

Acritical illness health insurance plan covers the insured against critical diseases such as heart attack, cancer, etc. These plans help you provide a lump sum up to the sum insured limit to cover the exorbitant medical expenses for such critical diseases.

However, getting the lump sum paid by the insurer is not an easy deal. You might not claim the lump sum amount under the policy unless you survive for a certain period after being diagnosed with a critical illness. Therefore, survival period is an essential aspect of a critical illness plan.

Importance of the survival period: Health insurance, especially critical illness plans, don’t provide you with death benefit coverage. Hence, you must understand the concept of the survival period. Mayank Kale, CEO and founder, Loop Health, said, “If the insured dies due to the critical illness condition, the insurance company will not immediately pay any amount. Moreover, they do not provide a death benefit to heirs. Besides, paying a huge amount together to all policyholders when they are diagnosed with a critical disease will cause a greater liability on the insurance company. Hence, companies have added the survival period clause.”

So, this way, when you are diagnosed with a critical illness, the health insurer pays a lump sum under the critical illness insurance plan only if you survive for a certain period.

Kale added, “The survival period is the amount of time that someone insured must live after being diagnosed with a severe condition such as cancer, cardiovascular disease, and so on. The survival period is an essential clause in a critical illness insurance policy since the insurance company will not pay the coverage amount until the insured survives this period. Depending on the plan, the survival period can range from 14 to 30 days.”

The survival period is not similar to waiting period: The first main difference between the two is that, while all health insurance policies include a waiting period, not all have a survival period. The waiting time of health insurance will be valid regardless of the policyholder’s ailment or illness. It is affected by pre-existing diseases and disease-specific waiting periods. The survival time, however, is only applicable to persons suffering from any life-threatening critical illness. The tenure of the waiting period is generally longer than the survival period. Unlike survival period, the waiting period is when a policyholder must wait before their insurance policy becomes valid to make claims.

What you should do: It would be best if you preferred to opt for a critical illness plan with a shorter survival period. Kale said that choosing a critical insurance plan with a shorter survival time allows you to get the policy’s coverage amount earlier and decrease the financial load that comes with a longer survival time.

He said, “Critical illness insurance plans typically do not offer a return on premium option if the insured dies during the survival period.” A return on premium option means to refund the total premium paid by the insured before his/her untimely death.

Thus, you should compare the survival period of the plan first and then buy it after taking help from a learned financial adviser.