What Is Critical Illness Insurance, and Do You Need It?

Laura Cave
March 17, 2021

by Laura Cave, Director of Marketing at Brella | March 17, 2021

While an increasing average life expectancy in the U.S. is certainly a good thing, getting older can come at a high cost. For decades, people have turned to critical illness insurance plans to help offset the costs of heart attacks, strokes, cancer, and other serious illnesses that are more likely to occur as we get older. Rising medical costs and insurance plans with high deductibles create a scary gap in coverage for aging Americans. Critical illness insurance was meant to help cover costs when traditional insurance coverage ended.

Sounds like a good plan to have, right? Not necessarily, especially when you consider how times have changed and what critical illness insurance actually covers. It’s not uncommon today to see critical illness benefits in the $25,000 or $50,000 range. But since today’s health insurance plans no longer have annual limits, such big payouts may be more than you actually need. Plus, most critical illness plans include only a handful of the most dangerous or life-threatening illnesses, so if you’re diagnosed with one that’s not on the list, you aren’t covered. 

So, there may be some drawbacks to critical illness insurance that might have you wondering: Should I get critical illness insurance to round out my health coverage?

Is Critical Illness Insurance Worth It?

Here are a few things to consider when deciding whether to enroll in a critical illness insurance plan.

1. Does Critical Illness offer the coverage you need?

As mentioned, CI plans offer big payouts for a few illnesses, but they typically cover only 4%* of conditions that would require urgent medical attention. CI plans also don’t cover injuries. If you’re younger and active, you might want to look for a supplemental health insurance plan that covers more conditions — including both illnesses and injuries — instead.

2. Does a Critical Illness plan meet your financial needs?

The average working American has an annual deductible of $1,644. This number is even higher for families with employer-sponsored health insurance. Meanwhile, only 39% of Americans can afford to cover an unexpected $1,000 expense. If your primary exposure is your health insurance cost-sharing responsibility, consider working on your savings or invest in a supplemental health insurance plan that pays cash for more health issues that could put you in a position of owing thousands toward your deductible.

3. Is the plan going to give you a good experience?

Unfortunately today’s typical insurance experience is complex, frustrating, and not all that consumer friendly. When it comes to the type of conditions covered under a critical illness plan, you may be asked to jump through a lot of hoops to file a claim. From confusing forms to long payout times to rushed customer service, today’s experience leaves a lot to be desired. If you’ve been through a stressful medical encounter, the last thing you want is a stressful insurance experience. 

Take the time to understand the claims process and how the insurance company supports you in these tough times. Go with a plan that offers straightforward claims and payout processes so you can actually reap the rewards promised to you. And go with a plan that offers members the support they need, especially when they’re critically ill and need it the most.

Brella does just that. We are a modern alternative to critical illness insurance for people who want additional supplemental coverage that helps ease the burden of your health plan’s deductible, copays, and other expenses that crop up when you’re sick or injured. Our plan offers wide-ranging coverage (beyond just a handful of the most critical conditions), affordable premiums to suit any budget, an easy claims submission process, and fast payouts. Plus, you can work with the same Brella Concierge throughout your membership. In short, Brella is an innovative supplemental plan designed to give you the coverage you need and the peace of mind you deserve.

If you’re interested in Brella, you can read more about our plans here or ask your employer or broker to get in touch with us at sales@joinbrella.com.

*Source: Statistic aggregated based on the Agency for Healthcare Research and Quality’s (AHRQ) annual reports on emergency room diagnoses for working-age adults in the U.S.