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The keys to making a successful Critical Illness Insurance Claim


April 25, 2012

The hottest insurance product on the market over the past 5 years has been critical illness insurance or "CI". What is critical illness insurance? Basically, it's a policy of insurance which gives you a lump sum payment in the event you sustain a critical illness such as a heart attack, stroke, cancer, blindness, HIV/AIDS, or other critical illness as defined by your policy.

By taking out a policy of critical illness insurance, you're betting against your own health. You're saying: "I know I'm going to get really sick, a heart attack, or a bad disease and I want to be compensated for it". Many see this as a smart bet given the increased reports of heart attack, cancer and other disease.

But what might seem like a simple concept; I get really sick so I get paid a lump sum from the insurance company; isn't so simple. These critical illness insurance policies contain tens of dozens of exceptions which make it very difficult to make a successful claim.

As a Toronto Personal Injury Lawyer, I see dozens of people who have sustained a critical illness and have made their claims, only to be denied by the insurane company. Promises by your insurance company and insurance broker to get $1,000,000 guaranteed, only to be denied! Here's why:

For starters, you need to ask your broker what's defined as a critical illness under your policy of insurance. If you sustain a heart attack, but heart attacks are not considered a critical illness under your policy, then the insurance company has every right to deny your claim. Talk to your broker about this. Make notes about your conversation. Read your policy carefully. If you don't understand it, ask your broker or get a second opinion.

Understanding your policy and how it works and what the exceptions are is crucial to your claim. Critical Illness premiums tend to be high. These are some of the most expensive insurance products on the market. You should know what you're paying for. It would make no sense to purchase a critical illness insurance policy which doesn't cover you for blindness, cancer, stroke or heart attacks and only covers you for Castleman's disease. What's wrong; never heard of Castleman's disease before? That's because it's so uncommon, few doctors ever come across it. So the odds of you getting Castleman's are so few and far between, why would you pay for a critical illness policy which only insures it, but not other common critical illnesses? Makes no sense. Know what you're getting in to before signing that contract of insurance.

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Another tip is for you to understand the survival period or moritoriam period for the illnesses covered under your policy. Some policies contain clauses which state that within or after the first 90 days of signing the policy, if you have any tests, investigations, signs or symptoms which lead to a diagnosis of a critical illness, then you will NOT be covered under the policy.

Example: You took out your policy of insurance on January 1, 2012. On January 2, 2012, your doctor found a lump on your breast and referred you to an oncologist. The oncologist diagnosed that you had breast cancer on May 1, 2012. The doctor finding the lump on your breast the day after you signed up for your critical illness policy will be considered a sign, symptom or investigation which led to the diagnosis of cancer which is excluded under the survival or moritorium period of your policy. Hence, you will be denied. Understand this surival or moritorium period. Make sure that it's as short as possible.

The final mistake which most claimants make is that they fail to provide the insurance company with all of the medical evidence which they need in order to make a claim. If you've been diagnosed with HIV/AIDS, then provide the insurance company with the test results and your doctor's notes so they can see that this is in fact the case. Just telling the insurance company of the positive test results isn't good enough. They need concrete proof. Give them the test results and your doctor's notes. It's the only way to ensure that your critical illness claim gets approved.