| Group critical illness insurance can be viewed as a | | | | company closely examines the insured's health |
| combination of group benefits and critical illness | | | | history and their family health history. Many |
| policies. This type of benefit is seen as an | | | | individuals may have problems qualifying for |
| excellent complement to Group Life schemes and | | | | coverage based on their age or their previous |
| can provide a very attractive solution for | | | | medical history may preclude or restrict coverage. |
| employees. | | | | On the other hand, group critical illness coverage is |
| Critical illness insurance was first developed by Dr. | | | | guaranteed and can provided at a discounted |
| Marius Barnard in 1983 as an effort to offset the | | | | premium - in many instances the savings can be |
| financial burden associated with developing health | | | | as much as 30 percent below that of an individual |
| problems. Recent medical advances have created | | | | policy. |
| an increased need for critical illness insurance; | | | | As a bonus, some group critical illness plans offer |
| more and more individuals are surviving life altering | | | | portable coverage. This feature alone is one of |
| illnesses, such as cancer, stroke or heart attack. | | | | the highlights of these policy types. It allows |
| But these advances in modern medicine have | | | | employees who leave their employers to continue |
| come at a cost - the increased survival rate has | | | | their coverage - and retain their group discounted |
| strained the Canadian health care system. This, | | | | premium. |
| coupled with the fact that many people are | | | | The amount of coverage a person may qualify |
| naturally seeking extra services and non-traditional | | | | for depends two main factors: the insurance |
| forms of treatment, has led to a dramatic rise in | | | | carrier and the size of the group. From an |
| cost of care and thus increasing the need for | | | | employers standpoint this can be a major lever in |
| additional coverage. | | | | attracting and keeping key employees. Critical |
| As mentioned above, cost of care in many | | | | illness coverage bridges the gap found in most |
| instances can be prohibitive and exceeds what is | | | | traditional employee benefit plans. An example |
| available in traditional group claims. That's where | | | | may be a senior executive whose family health |
| critical illness insurance comes in - it pays out a | | | | history may have precluded him from individual |
| lump sum tax free payment upon diagnosis of a | | | | critical illness coverage and his group disability plan |
| critical illness. The money can be used for any | | | | only covers a fraction of his income. A group |
| purposes - to cover experimental treatment, | | | | critical illness plan may provide the leverage |
| provide daily living assistance or depending on the | | | | needed to lure him from another company or to |
| size of the policy seek treatment out of country | | | | keep him with his present employer. |
| just to list a few examples. | | | | A key advantage to the employee is the potential |
| While the understanding the need for critical illness | | | | portability of the coverage. An employee retiring |
| is easy, it can get extraordinary difficult to obtain | | | | at 60 would be faced extortionate premiums on |
| the coverage. Individual applications for this type | | | | an individual critical illness policy and the coverage |
| of coverage are much more closely scrutinized | | | | may not even be available due to health issues. |
| than life insurance applications. This is | | | | However, if the same employee was enrolled in a |
| self-explanatory - an average Canadian is much | | | | group critical illness plan the coverage may be |
| more likely to face a critical illness than death | | | | portable and the rates would be based on the |
| before the age of 75. Therefore, the insurance | | | | employee's age at the time of enrollment. |