Why insurance against cancer is critical

NEW DELHI: The dreaded C-word is in the news after actor Sonali Bendre disclosed that she has cancer. Earlier, actor Irrfan Khan had made his fight against the disease public, adding to the awareness about cancer and its treatment.
However, the level of preparedness for managing the financial aspect of the treatment remains low despite life insurers actively promoting policies that offer targeted protection.Recently, health insurer Star Health also launched a policy aimed at cancer survivors. “The sensitivity towards buying insurance to cover this disease is low. Distributors do not sell these policies as much as they promote policies with a savings element,” says Anilkumar Singh, Chief Actuarial Officer, Aditya Birla Sun Life Insurance.
Cancer plans the answer
Cancer is now responsible for almost one in six deaths globally. With huge treatment costs, cancer policies can play a crucial role.
The sum insured can be as high as ₹60 lakh and these policies cover cancer right from the early to the advanced stages. Future premiums are waived off on detection for three to five years to ease the burden on policyholders.

The claim settlement process is simple, as these are fixed benefit policies that hand out a pre-defined sum on diagnosis. Unlike regular health insurance covers, the cancer policy payout can be used to meet any recuperation-related expenses as well. Also on offer are increased sum assured options under premium variants, where the cover increases by 10% for every claim-free year. Income benefit is another feature that can help during the recovery phase, particularly if the health condition is debilitating enough to force a break from employment.
Despite the benefits, the policies have met with moderate response. “In India, a number of cancer products have been launched and uptake of cancer cover over time may increase, with increasing awareness levels, higher incidence of the disease, improving medical support and higher cost of treatment,” says Khalid Ahmad, Head, Products, PNB MetLife.
Unlike life insurers’ cancer covers, Star Health’s Cancer Care plan extends cover to those who have been diagnosed with cancer (stage 1 or 2). Launched as a pilot, the product covers the risk of recurrence, metastasis, second cancer as well as second malignancy unrelated to first cancer, apart from regular hospitalisation expenses.
Beware of the exclusions
Study the exclusions and restrictions before you take a call. Cancer policies from life insurers restrict coverage for early-stage cancers to 20-25% of the sum insured. Later-stage cancer claims will be eligible for the entire sum assured minus claim paid out, if any, during initial stages. While, some plans provide a sum assured of 150% for major stage cancer, check if any particular cancer and recurrent claims of cancer affecting the same organs are excluded. For instance, Aegon Life’s policy does not cover skin cancer.
Standard exclusions like pre-existing illness apart, cancer caused by sexually transmitted diseases, HIV, or AIDS or arising out of congenital condition and contact with radiation or radioactivity, are not covered under these policies.
Cancer or critical illness
A cancer cover will not be of help in case you contract other critical diseases. A regular critical illness policy or a rider covers a range of serious ailments. Therefore, you will have to make the choice on the basis of your health condition as well as family health history. Also ensure you have a basic health insurance policy in place to cover hospitalisation.