Should You Get Critical Illness Insurance For Your Child?

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Danika Dickson

When your child suffers with a serious illness, the impact is felt on the entire family: physically, emotionally, and financially. Child critical illness coverage doesn’t stop a child from becoming sick, but it can relieve some of the pressure on the family. Many parents take time off work when their child is sick. For most Canadians, paid time off is limited. Working Canadians that are self-employed or contract workers don’t have any paid time off.

What is child critical illness insurance?

Critical illness for children provides a lump sum payment if your child is diagnosed with one of the illnesses covered by your policy. The products cover a range of illnesses such as cancer, acquired brain injury and major organ failure. Children are also covered for additional illnesses such as type 1 diabetes mellitus. Insurance carriers that offer critical illness for children cover the same illnesses for adults as well as 5 to 7 more for kids.

What are the benefits of child critical illness insurance?

The money can be used how you wish. Some of the commons reasons parents and grandparents choose critical illness to protect their little ones:

  • You can put the money towards the cost of medical treatments that are not covered by your provincial or private health coverage.
  • Pay for non-medical costs, such as hospital parking, taxis or hotel accommodations if you have to visit out-of-town specialists.
  • The coverage allows you and your partner to take time off work to care for your child without having to worry about money.
  • Monthly rates are lower than adults and are guaranteed to stay the same. Many policies have guarantees for the coverage to continue into adulthood. That means, when your children are adults, they can get critical illness for cheaper rates that if they waited to apply for it when they are older.

Is critical illness insurance for kids worth it?

The cost of critical illness for children is quite low compared to the costs for adults. When choosing a plan, parents or grandparents can set it based on how much they wish to pay each month or year. We hope that you never have to make a claim for critical illness for your child or grandchild. That being said, some insurers may return some of your premiums if you never make a full claim on your policy. This helps to justify the cost and determine if it makes sense for your family. If you do have to make a claim, then it’s absolutely worth it to have critical illness in place. If you don’t have a claim, and you have a “return of premium” rider, then you get a substantial portion (or all, depending on your policy) back. It then functions like a forced savings plan.

Product highlight: Sunlife Critical Illness For Children

In Canada, there are a limited number of insurance providers that offer critical illness insurance for children and youth. Within this niche market, Sunlife offers a product specifically for children that has an top “return-of-premium option”, which automatically returns 75% of premiums you’ve paid when your child turns 25 or on the policy’s 15th anniversary, whichever is later. (Note that this is an optional benefit that you would add when you purchase the policy.) It’s kind of like a forced savings plan.

If your child does get sick, it will happen whether there is a critical illness policy in place or not.  If you have the coverage, it can provide some relief during a difficult time.

Are you interested in finding out more about critical illness options for your family?

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