How to fight cancer, financially

A cancer plan can safeguard your finances and help you focus on combatting the disease

When it strikes your near ones, is when you realise that the risks cancer poses are real. Recently, a friend of mine called to inform me that he was recently diagnosed with cancer in his cheek and was hospitalised for a week.

Two things shocked me — first, that cancer can strike a young person with an active lifestyle, and second, his financial unpreparedness to face this situation. Most of us are grossly under-prepared to handle such eventualities.

February 4, every year, is marked as the World Cancer Day to encourage its prevention and treatment.

Towards the objective of being financially ready to face cancer, you should know a few things:

Most of the time, cancer treatment does not require hospitalisation and, thus, a normal health insurance policy may not serve the purpose.

Even if it covers critical illness, it is usually when the illness has reached a critical stage.

Cancer insurance plans

These plans are customised for cancer with a purpose of providing timely financial assistance.

Most insurers issue the policy without medical tests, depending on the customer’s age and the facts declared in the proposal form.

It is important to declare the details correctly at the time of buying the policy as people with family history of cancer might not be eligible for a plan.

It is to be noted that this is only applicable in case of cancer history among the blood relatives, that is, parents or siblings. In addition to this, there are certain exclusions such as a pre-existing condition of cancer, cancer contributed by STD (sexually transmitted diseases, AIDS or HIV) or intoxication by alcohol or narcotics or drugs not prescribed by a registered medical practitioner.

Most cancer insurance policies pay the amount in stages.

For example, 25 per cent of the sum assured is immediately credited to the policyholder’s account once the disease is diagnosed.

If the cancer is found in more than one organ, then 20 per cent of the sum assured is given for the treatment of each organ.

Furthermore, some plans pay out 100 per cent of the sum assured during the advanced stages, and even an additional 10 per cent over a certain period as income.

Cancer insurance covers can be brought for as little as ₹5,000-6,000 a year for 40 years. Premiums depend on the sum assured, age and gender. A 30-year-old male will pay ₹8,231 annually, for maturity age 70 and sum assured ₹25 lakh.

In most cancer plans, the sum assured increases by 10-15 per cent for every claim-free year.

The writer is Director and Chief Distribution Officer, Max Life Insurance

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