A speaker at a conference I was at told the audience that everyone there would have a major medical expense at least once in the next 10 years, and that we should make sure we were “covered”. I remember thinking: surely he is referring to the others in the audience and not me…
Unfortunately it turned out that our family was one of the “early” participants: we had a child end up in ICU for 11 days. Our medical scheme was sufficient to cover all of that. But when we left the hospital, that’s when the bills started mounting up.
All’s well that ends well they say and fortunately the story has a happy ending.
People are funny about talking about things like death or cancer. We encounter so many people who have not drafted a will – somehow there seems to be this underlying belief that if you don’t do it or think about it, then it might not happen. Conversely, there is a belief that if you draft your will you are tempting fate and that’s not something you really want to be doing.
Newsflash, you are going to die one day, will or no will!
In the same vein we all know someone who has or has had cancer…we talk about the “big C” as if the very mention of the word could infect us. Medical knowledge and expertise have some such a long way that by far the majority of people who contract cancer these days live to talk about it.
Stats show that the average 40-year-old male has a 55% probability of contracting a life-changing critical illness by the age of 75 (37% for women). And while the probabilities may be in your favour it is the financial consequences that need to be considered and planned for. Medical aids and insurance are cost-effective ways to manage the risk.
Even if you are young and healthy, you should at least make sure that you are on a medical aid or good hospital plan that will cover you for most of the in-hospital expenses that will be incurred should you contract a critical illness.
How much is enough?
How long is a piece of string really? If you are concerned, and particularly if you have a family history (and hence a potential predisposition to a dread disease) it’s a good idea to get critical illness cover. This insurance gives you a once-off lump sum in the event of diagnosis – something that will come in really useful if you face protracted treatment that maxes out your medical scheme allowance, as chemotherapy, for instance, so often does.
But as with all things financial, be pragmatic about it – take what you can afford rather than take nothing at all. The amount you need to take will always depend on your own personal circumstances.
Critical illness policies can and do vary from company to company so find out what is covered under the policy you have or are considering. It might even be a good idea to get your doctor to read over the definitions and conditions that are covered and/or excluded. That way you get a medical opinion on a medical issue.
To help policy holders, the Association of Savings and Investments of SA (ASISA) has also adopted a set of standard critical illness definitions . The “big four” are heart attack, cancer, stroke and coronary artery bypass graft. More comprehensive plans include significantly expanded versions of each of these.
I’m on medical aid - surely I don’t also need dread disease cover?
Much depends on the type of scheme you are on, what conditions, and the amount of cover for each event. Certain cancer treatments are considered too new or too experimental to be covered by medical schemes, and this is where a dread disease policy could help by providing funds that will allow you to seek the alternate/better treatment.
One case study I know of illustrates the benefit of having both. This client had dread disease cover as well as a comprehensive medical aid. When he had a heart attack, the medical scheme paid for all the costs associated with the heart attack, and he used the payment from the dread disease policy to address the cause of the heart attack – stress, a poor diet and not enough exercise. He took a holiday and used the balance of the money to alter his lifestyle!
So find out how much cancer cover your medical scheme allows for, and what the cost of treatment could be, and then decide if you need the additional funds that a dread disease policy could offer. Be warned, dread disease cover is quite expensive. And this alone should give you some indication of how often people claim on this benefit.
(Gregg Sneddon , Health24, March 2011)