Compare Critical Illness Insurance Policies
Critical illness insurance rates vary significantly based on many factors. Compare more than one option to make sure you get the best deal for the protection you need.
Compare Critical Illness Insurance Pricing Factors
- Cancer only or comprehensive CI
- Your age when you apply
- Your sex
- Guaranteed issue or underwritten
- Amount of benefits you select
- Use of tobacco products
- Your current health
- Medicines prescribed for you
- Pricing factor used by the insurer
- Maximum policy renewability
For $10,000 of critical illness insurance a 45-year old male could pay $158 a year. That same man could also pay $300 or more for virtually identical coverage. A 48-year old female could pay $153. She could buy the same coverage from another insurer for twice as much.
How much you will pay for critical illness insurance varies. It really does pay to compare before you buy.
That’s true when your employer offers critical illness insurance that is deducted from your paycheck. It could be a good value. Or, you might find that you could save buying the coverage directly from an insurer. That savings will add up.
Use the Association’s Critical Illness Cost Calculator to get an instant rough cost for $10,000 of cancer-only coverage. A cancer-only policy will cost less than a comprehensive critical illness insurance policy. You can multiply the cost by 3 to get a rough sense of what a CI policy might cost.
Who Should Compare Critical Illness Insurance?
The Association believes everyone should compare. But here are a few situations where comparing is truly recommended. It can save you money.
- You are male
- Your employer offers voluntary coverage
- You are a non-smoker / non-tobacco user
- You are in good health
You want coverage during your working years
Compare Critical Illness Insurance: Cancer-Only or Comprehensive CI Insurance
Many insurance companies today are offering consumers two options. Choice one is a cancer-only policy that pays cash if you are diagnosed with cancer. The other choice is a comprehensive critical illness insurance policy.
This option pays if you are diagnosed with one of the big three (cancer, heart attack or stroke). They often pay if you have one of the other less common illnesses. A cancer-only policy is going to be significantly less costly and, especially at younger ages, may cover the greatest risk you face.
Many heart attacks and strokes happen after age 65, 70 or older. This is something to seriously think about. It’s a reason to definitely compare your options.
Compare: Male Versus Female
Use the Critical Illness Cost Calculator on the Association’s home page and you’ll immediately see that rates can be different for men and women.
Insurers who base their rates on sex-distinct rates, factor the actual risks separately for men and women. Insurers that use unisex rates combine the two. Generally, one sex is subsidizing the other sex.
This is one very important reason to compare.
Compare the Amount Of Benefits Selected
You can buy $10,000 of coverage (potential benefits). You can buy $500,000 of coverage. Obviously you will pay much more for that much potential cash payout. In 2019, the average amount of critical illness insurance benefit purchased was around $15,000.
For most individuals, our advice is to buy an amount equal to between 6 and 18 months of rent or mortgage payments. That’s generally the time you might expect to be off work for treatments or for recovery. If you are a business owner, you likely need more.
Compare If You Do NOT Use Tobacco Products
Smokers and those who use tobacco products face the greatest risk of having cancer, a heart attack or stroke. Some insurers offer blended rates. That means that non-smokers (non-tobacco users) are subsidizing the smokers who apply.
If you do not use tobacco products, you’ll likely find lower rates by selecting a policy that offers both Tobacco Use and Non-Tobacco Use rates.
Compare if Your Current Health is Good
Many critical illness insurance products offered through your employers are referred to as guaranteed issue. Simply stated, the insurer will issue coverage to anyone who applies. That’s a real benefit to those with existing health conditions (who are subsidized by those who apply and are in good health). Policies offered on an individual basis often require simplified health underwriting or a complete health evaluation.
If you are in good health, don’t take any (or common) prescription medicines and fall within the acceptable height/weight tables it pays to compare.
Compare if You Want Lower Rates During Working Years
Your need for critical illness insurance is greatest during your working years. Typically that from ages 45 to just after starting Medicare. After retirement and going on Medicare, you may no longer be facing high health plan deductibles or out-of-pocket expenses. Your home may be paid off.
Some critical illness insurance policies will offer coverage up to age 70. Because of that, they will likely be less expensive than plans that continue to say age 95. Those older ages are when insurance companies know they will be paying lots of claims.
You’ll pay for that when applying at younger ages.
An example of costs for Cancer-Only insurance
| You Are | Smoker or Non-Smoker | Benefit Amount | Cost-Per-Year |
|---|---|---|---|
| Male age 40 | Non-smoker | $25,000 | $67 |
| Male age 40 | Smoker | $25,000 | $95 |
| Female age 40 | Non-smoker | $15,000 | $84 |
| Female age 40 | Smoker | $15,000 | $98 |
| Male age 52 | Non-smoker | $10,000 | $89 |
| Male age 52 | Smoker | $10,000 | $171 |
| Female age 52 | Non-smoker | $10,000 | $106 |
| Female age 52 | Smoker | $10,000 | $171 |
An example of costs for Critical Illness insurance
| You Are | Smoker or Non-Smoker | Benefit Amount | Cost-Per-Year |
|---|---|---|---|
| Male age 40 | Non-smoker | $10,000 | $82 |
| Male age 40 | Smoker | $10,000 | $134 |
| Female age 40 | Non-smoker | $10,000 | $92 |
| Female age 40 | Smoker | $15,000 | $118 |
| Male age 52 | Non-smoker | $10,000 | $232 |
| Male age 52 | Smoker | $10,000 | $437 |
| Female age 52 | Non-smoker | $10,000 | $199 |
| Female age 52 | Smoker | $10,000 | $308 |
Rates shown are approximate examples created by the Association. They are provided merely to help consumers understand the subject.
Save on Medicare Supplement Insurance
Visit the website of our sister organization, the American Association for Medicare Supplement Insurance. Use our free online directory of local Medicare Supplement insurance agents to find agents for your Zip Code.
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