The Importance of Having Critical Illness and Disability Insurance

by Kyle Arnold

We always plan for our future, primarily because life is unpredictable. Hence, financial experts believe in having a robust financial plan. An important aspect of a financial plan is to have health insurance coverage for yourself if an unfortunate critical illness is diagnosed.

The absence of planning can damage your earning capacity and wipe out your hard-earned savings, pushing you into debt. Scary, right?

But you can save yourself from this scenario by investing in a health insurance plan. A health plan is the best investment that protects you financially against medical emergencies including critical illnesses and disabilities.

Further, you can gain health insurance tax benefits that will also help you save more money!

 What is Critical Illness and Disability Insurance?

Critical Illness and Disability insurance are riders which you can add to your comprehensive insurance plan. These riders can provide additional protection against unforeseen circumstances that could jeopardise your financial security and well-being.

Let us understand the role of each rider in detail.

 What is Disability Insurance Coverage?

Accidental disability is an uncontrollable and unanticipated situation that can lead to disability. Disability can either be long-term or for a shorter time but it can seriously influence your ability to work and earn a livelihood.

Therefore, to protect against such circumstances, a disability medical health insurance plan, also sometimes referred to as personal accident insurance, comes in handy. With such medical coverage, a part of your income, which you are unable to earn because of the disability for a specific period, gets covered by your insurance provider.

The cost of disability insurance plans will rely on various factors such as your age, health condition, the coverage you need and the duration of the policy.

 What is Critical Illness Insurance Coverage?

Critical Illnesses are severe medical conditions that need immediate attention. Such illnesses need extensive treatment, which can severely affect your finances. Further, a basic health insurance plan usually doesn’t provide coverage against critical illness; therefore, that makes critical illness plans extremely important.

With a critical illness health insurance plan, you can get financial protection against severe terminal diseases, which include cardiac arrest, cancer, kidney failure, etc. Insurance providers like Tata AIG provide critical illness coverage for more than 40+ diseases, ensuring that you are safeguarded against a wide range of life-threatening conditions.

 Importance of Having Critical Illness and Disability Insurance

1.       Replaces a part of your income

Not being able to work due to disability or a severe illness can not only put you in a financially sticky spot but also destroy your mental well-being.

These coverages can fill financial gaps as this money can be used for taking care of your family and meeting day-to-day living.

2.       Financial support to dependents

If you are the only breadwinner in your family, then having a critical illness or disability coverage becomes very important. They provide financial support even if you have decent savings. Therefore, to avoid creating strain on your family finances, such health insurance plans come in handy, especially when you are unable to work.

3.       Provide multiple payout options

Such health insurance covers come with multiple payout options. Sometimes, they pay out a lump sum amount or in the form of regular income.

So, it is essential to check the options your plan offers. Just choose what works best for your situation. During such medical situations, you or your family will get a payout based on your policy terms.

4.       Builds confidence to face situation

Critical illness or disability covers offer a stable stream of income, which helps you build confidence to face such difficult situations. The lump sum or regular amount received can provide a safety net that makes facing tough times a bit easier.


Buying critical illness and disability riders with your health insurance plan is like adding extra protection to your policy. So if something wrong happens, like an accident that disables you or you suffer from a severe illness, you are at least financially protected. It is like having an extra umbrella, especially for those rainy days.

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