How Much Does Crit­i­cal Ill­ness Insur­ance Pay Out in 2023? 

By now, you might already know what critical illness insurance is, what it covers and when you should get it. But you may still be wondering about an important aspect of critical illness coverage: Getting paid. If you’re diagnosed with a covered illness or condition, you’ll want to receive your payment as quickly and easily as possible to minimize disruptions in your life.

In this article, we’ll delve into the details of critical illness insurance payments. When you’re finished, you’ll walk away better informed about how critical illness insurance can help you prepare – and prepare you to determine an amount you’ll need.

• What is critical illness insurance?
• How does critical illness insurance work?
• When should I get a critical illness insurance policy?
• When does a critical illness insurance benefit pay me?
• How much does critical illness insurance pay?
• How does critical illness insurance payout work?
• Do you have to pay taxes on a critical illness insurance payout?
• How long does it take for critical illness insurance to pay out?
• Is critical illness insurance worth it?
• Where do I get critical illness insurance?

What Is Critical Illness Insurance?

Critical illness insurance is an insurance product designed to help protect you from the financial fallout of a serious disease or health event like a heart attack, stroke or cancer. If you are diagnosed with a covered disease or health event, a critical illness insurance policy gives you money you can use on whatever you need, from replacing lost wages or traveling for treatment to taking extra time off work or paying off your medical bills.

Critical illness insurance isn’t a replacement for comprehensive health insurance, and you should make sure you have health insurance before you purchase a critical illness policy. It’s instead designed to complement your existing health coverage by giving you money to help with the things health insurance doesn’t cover.

How does Critical Illness Insurance Work?

If you’re diagnosed with a condition covered by your critical illness insurance policy – Assurity’s Critical Illness Insurance covers cancer*, heart attack**, stroke and advanced Alzheimer’s disease – you simply submit a claim for benefits. If everything is in order, you’ll receive a lump-sum payment that you can use in any way you want. For instance, you can use your critical illness insurance benefit to pay for:

• Travel and lodging for doctor’s appointments
• Out-of-pocket expenses such as experimental treatment
• Lost wages from time off work
• Living expenses such as your rent or mortgage, utilities, groceries and childcare
• Even a nice vacation while you recover

When Should I Get a Critical Illness Insurance Policy?

When it comes to most types of insurance, there’s no time like the present – and critical illness insurance is no exception. The cost of a critical illness insurance policy rises as you age – it’ll be much cheaper at age 30 than age 50, for example. Most insurance companies cap the age at which a person can buy a critical illness insurance policy at 65 or 70 years.

It’s also worth considering your future needs and plans. For example, do you plan to someday buy a bigger house with a larger mortgage to cover, have more children, or go back to school? These costs may all factor into the amount of coverage you want.

Unlike most other critical illness insurance plans, Assurity’s Critical Illness Insurance doesn’t reduce your benefit or raise your premiums when you turn 65. If you choose to buy an Assurity Critical Illness Insurance plan, you can rest easy knowing that you’ll receive your full benefit when you need it most and not have to pay more than you thought.

When Does a Critical Illness Insurance Benefit Pay Me?

When you’d receive your critical illness insurance benefit payment depends, of course, on your policy. Almost all critical illness insurance policies have a waiting period of some sort with regard to cancer – 30 days, for example. Beyond that, many critical illness insurance policies will provide coverage immediately for medical events like a heart attack or stroke.

The process for making a critical illness insurance claim can vary depending on the product and carrier you purchase it from. Many carriers ask to undertake a lengthy claims process filled with forms and phone calls – but Assurity makes it easy. Log into MyAssurity – our online customer portal – submit the claim and any other relevant materials like physician information, and you’re done.

How Much Does Critical Illness Insurance Pay?

The amount that a critical illness insurance policy pays is up to you – this is called a benefit amount, and you can select how much you want it to be when you purchase your policy. Assurity Critical Illness Insurance offers benefit amounts between $5,000 and $50,000, but some other companies offer amounts up to $500,000. It’s important to remember that a higher benefit amount means a higher monthly payment for your coverage.

There’s no easy formula to find out how large of a critical illness insurance benefit you need. Each diagnosis will come with its own challenges and costs, and no two circumstances are alike.

Start by considering what you know – your health insurance deductible, your savings, and how long you could go without working are a good place to start. This will give you a baseline for how much coverage you’d need if faced with a sudden medical expense. From there, you can ask yourself whether you’d want to pay for extras like experimental treatments, travel to experienced doctors or childcare if you’d need it.

When comparing various critical illness insurance policies, it’s important to consider how simple – or complex – you want your policy to be. What do you actually need covered? Does the coverage require a medical exam? Does the critical illness insurance policy have any fine print relating to how much your premiums fluctuate as you get older?

Assurity’s Critical Illness Insurance is designed with simplicity in mind – four covered conditions, up to $50,000 in coverage, no medical exams needed – and your premiums will not go up as you get older.

How Does Critical Illness Insurance Payout Work?

Filing a claim for critical illness insurance is easy. Following the diagnosis of a covered condition, you simply submit documentation from your physician verifying your diagnosis. For Assurity Critical Illness Insurance, you can do this all online from the MyAssurity customer portal, where you can find all the forms and information you need to file a claim.

If everything is in order, you’ll get your payment as a check – it’s that simple. You can deposit and use the money immediately for whatever you want or need: treatment, health insurance bills, your mortgage payment or whatever else needs to be taken care of.

Do You Have to Pay Taxes on a Critical Illness Insurance Payout?

Critical illness insurance payments aren’t considered income, so they’re not subject to taxes. You’re free to use the entire amount in whatever way you want without worrying about deducting tax.

How Long Does It Take for Critical Illness Insurance to Pay Out?

It’s important that you’re able to access money as quickly as possible when facing a severe medical event, so we’ve worked hard to make sure the payment comes quickly. Most claims for Assurity Critical Illness are paid out within 10 days, but in rare cases we may require additional information – if that happens, it may take a few days longer. Once you receive the money, you can use it immediately.

Is Critical Illness Insurance Worth It?

If you’d be exposed to high out-of-pocket costs when facing a serious illness, critical illness can help. It’s one of the most effective and affordable ways to cover large medical expenses – if you wouldn’t be able to afford these costs from your savings alone, or if doing so might jeopardize your financial goals, critical illness insurance is worth serious consideration.

Get a Quote for Assurity’s Critical Illness Insurance Coverage

If you’re ready to learn more and get your personalized price for critical illness insurance, you can get a custom quote online in minutes to see how affordable it would be for you. You can also learn more about Assurity’s Critical Illness Insurance and find more articles, resources and tools.

Additional disclosure information

LIMITATIONS AND EXCLUSIONS (may vary by state)

Pre-existing Condition. Pre-existing condition means a sickness or physical condition for which, during the 12 months before the issue date or last reinstatement date, the insured person received medical consultation, diagnosis, advice or treatment from a physician or had taken prescribed medication. No benefits will be paid for a critical illness that is caused by a pre-existing condition unless the date of diagnosis is after the policy has been in force for 12 months from the issue date or last reinstatement date.

Waiting Period. Waiting period means the 30 days following the issue date or ten days following the last policy reinstatement date. The date of diagnosis of a covered critical illness must be made while the coverage is in force and after any waiting period. No benefits will be paid if a diagnosis or a medical consultation that leads to diagnosis of invasive cancer or non-invasive cancer occurs during the waiting period. If cancer is diagnosed during the waiting period, benefits will be paid for a subsequent diagnosis of cancer if the insured person is symptom- and treatment-free for at least 12 consecutive months and in complete remission prior to subsequent diagnosis.

Misstatement of Age and/or Gender. If the insured person’s age and/or gender has been misstated, an adjustment in premiums, coverage or both will be made based on the correct age and/or gender. If, according to the correct age, the coverage provided by the policy would not have become effective or would have ceased, Assurity’s only liability during the period in which the insured person was not eligible for coverage shall be limited to a refund of premiums.

Misstatement of Tobacco Use. If, during the first two years of the policy, the tobacco status of the insured person has been misstated, Assurity will revise the policy’s benefit amount to the amount the premium paid would have purchased using the correct tobacco status on the issue date.

The policy will not pay benefits for losses that are caused by or are the result of an insured person:

• being exposed to war or any act of war, declared or undeclared;
• actively serving in any of the armed forces or units auxiliary thereto, including the National Guard or Army Reserve, except during active duty training of less than 60 days;
• engaging in hang-gliding, hot air ballooning, bungee jumping, parachuting, scuba diving, sail gliding, motor vehicle racing, parasailing, parakiting, mountain or rock climbing, B.A.S.E. jumping, sky diving or cave diving;
• being addicted to drugs or suffering from alcoholism;
• being intoxicated (as determined by the laws governing the operation of motor vehicles in the jurisdiction where loss occurs) or under the influence of an illegal substance or a narcotic (except for narcotics used as prescribed to the insured person by a physician);
• committing or attempting to commit a felony;
• being incarcerated in a penal institution or government detention facility;
• engaging in an illegal occupation;
• intentionally self-inflicting an injury; or
• committing or attempting to commit suicide, while sane or insane.

Policy Form No. I H1820 underwritten by Assurity Life Insurance Company, Lincoln, NE.

IMPORTANT NOTICE— CRITICAL ILLNESS INSURANCE PROVIDES LIMITED BENEFIT COVERAGE. It is not a comprehensive major medical plan or Medicare supplement policy and does not satisfy the requirement for minimum essential coverage under the Affordable Care Act (ACA). It is not a substitute for major medical insurance and may not be appropriate for Medicaid recipients.

This policy may contain reductions of benefits, limitations and exclusions. Click here for standard Limitations and Exclusions. Product availability, features, rates, limitations and exclusions may vary by state. The state specific policy form is the ultimate authority for any questions about this product.

*In some states, diagnosis of cancer during the first 30 days following the policy’s issue date results in a significant benefit reduction or policy cancellation. The percentage benefit amount payable for invasive and non-invasive cancer combined cannot exceed 100%.

**Heart attack does not include established (old) myocardial infarction occurring prior to the issue date, sudden cardiac arrest, cardiac arrest or cardiopulmonary arrest.

Assurity reserves the right to order, at the company’s expense, evidence of insurability which the company feels is necessary for the prudent evaluation of the risk.

Assurity is a marketing name for the mutual holding company Assurity Group, Inc. and its subsidiaries. Those subsidiaries include but are not limited to: Assurity Life Insurance Company and Assurity Life Insurance Company of New York. Insurance products and services are offered by Assurity Life Insurance Company in all states except New York. In New York, insurance products and services are offered by Assurity Life Insurance Company of New York, Albany, NY. Product availability, features and rates may vary by state.