Merely the mention of the word cancer can instill fear and fright in the toughest of person. But, getting scared is not the answer and to be prepared at least financially is the least one can do to. The incidence of cancer seems to be increasing in the country. As per a recent study, cancer cases are likely to increase from 14 lakh in 2016 to over 17.3 lakh by 2020.
Irrespective of age, social status, physical fitness and gender, cancer can hit anyone. The prominent Indian celebrities who have been hit by the disease are cricketer Yuvraj Singh, movie director Anurag Basu, and actresses Nargis, Mumtaz and Manisha Koirala and recently Sonali Bendre is undergoing treatment for cancer.
Several studies have shown that more than genetics, 70- 90 per cent of all cancers are environmental. The cancer scenario in India is also alarming as according to GLOBOCAN 2012, a report prepared by World Health Organization’s International Agency for Research on Cancer, India already has the third highest number of hematological cancer patients in the world after the US and China.
The occurrence of cancer, in addition to bringing an emotional setback, is bound to be a financial setback to the family unless there is a provision for it. As the incidence is showing an increase, it is better to buy an insurance plan to meet its rising cost. Depending on the stage and treatment options, it could cost as low as Rs 2.5 lakh for six months of treatment, to as high as Rs 20 lakh. There are cancer insurance plans of life insurance companies that one may consider buying so as to meet the cost of cancer.
There are few life insurance companies which offer cancer insurance plans, however, understand the way the benefits are spread out in them before opting for them. See, if the cancer plan you are considering to buy, offers benefits including payouts for all the stages. Secondly, see what kind of benefit applies in each of such stage and the total benefit from the plan. Thirdly, see if the plan offers a fixed sum insured throughout the term or is the sum insured is increasing at say 10 per cent every year up to a certain fixed limit. The premium accordingly could be higher for such a plan but it ensures taking care of escalating medical costs. Fourthly, there could be a waiver of all future premiums once the cancer is diagnosed. See, at what stage does the plan offers it. Fifthly, on the diagnosis of cancer, there could be a regular income benefit as a fixed percentage of sum insured.
The lump sum payout at any stage will adjust any earlier payouts at an early stage. For example, if 100 per cent of sum insured is paid in the major stage, then the 25 per cent paid earlier in the early stage will be deducted. Also, in cancer plans, there is no death benefit but if death is within the waiting period, 100 per cent of the premium is refunded to the family. There is an initial waiting period of 180 days from the date of commencement of the policy or from the date of reinstatement of the policy for the diagnosis of cancer and valid claim to be admissible under this policy. There can also be a seven day survival period in all these plans.
We have seen a massive increase in queries to help people evaluate and opt for the best cancer insurance plan as these plans tend to be quite complicated and people want to understand how to build the best protection for themselves with the matrix of health, critical illness, and cancer insurances. There has also been a huge spurt in queries for cancer and critical illness covers to supplement their peoples individual Mediclaim’s.
Please note that a cancer insurance is not an alternative to health insurance (Mediclaim). One has to have a good Mediclaim plan which he has taken after due consideration and discussion with a good broker/advisor that covers the cost of hospitalization or a critical illness plan that pays the entire sum insured at the time of the dreaded diseases, cancer plans appears to be a more inclusive insurance plan than the other alternatives at covering the financial cost in terms of loss of income due to cancer.
Written by Sanjiv Bajaj, VC & MD of Bajaj Capital