Critical Illness Insurance is seen as assistance for a life threatening illness that may happen to an individual. It is given as a lump sum payment with the amount depending on the set terms and conditions of the policy holder with the insurance provider.This type of agreement is comparably easier to other health related insurance. However, there are things that you need to know about Critical Illness Insurance that may cost you if you are not aware of their common terms and conditions:

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1. Critical Illness Insurance is not for everyone – If you have a pre-existing medical condition, you have a very high chance of being denied of your application. None of the insurance providers want to accept anyone who may become a high liability risk for them. Part of the application process is a careful medical check up conducted either by the company appointed doctor or by the doctor of your choice.

This also means that you have to tell the insurance company your entire medical history. There are insurance companies who want to get out of financial liability to their policy holders that they dig into the medical history of the individual. If they see any slightest indication that could be a cause of critical illness, your claim will be denied due to non-disclosure.

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2. Your current health insurance should be more than enough – If you are working with a company that offers health care insurance, double check on their limitations. They may provide coverage on certain health conditions that you have or may have in the future.

Your personal health insurance may also give you enough coverage. However, remember that your present health care insurance could only cover up to a certain extent. You may compensate your medical bills with disability insurance if your company offers that type of insurance.

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3. Refund clause in Critical Illness Insurance – If you are shopping for a critical insurance company, better select a company that guarantees a refund of the premium in case you were unable to use the insurance policy. Insurance companies offer refund to their policy holders when the maturity of the insurance policy is reached without any illness from the individual. There is percentage deducted from the total premium paid by the policy holder but the fact that the policy holder is entitled with a refund is a good thing.

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4. Your claim is still valid if you make a full recovery – There is a common misunderstanding that Critical Illness Insurance could only be obtained by individuals who could pass away based on critical illness. This is not true. If the policy holder was able to overcome the life threatening situation, the policy holder will still be able to file claims.

Most of the policy holders of Critical Illness Insurance did not have any pre-existing medical condition so there is a high probability of recovery as long as proper medical attention is given.

Be smart while buying Critical Illness Insurance. There are certain factors in your work and health that may or may not dictate the necessity of this type of insurance.