CI Plan: To Buy Or Not To Buy?

A common misconception is that a medical card is enough to cover all costs related to every major and minor health issue you face.

Apparently not.

Here, Great Eastern Takaful’s Assistant Vice President Aida Yuhaniza explains why you need a comprehensive Critical Illness (CI) cover and shares questions you should ask your agent to be able to decide on the best plan.

Q: Why would there be a stand-alone Critical Illness plan? Isn’t the medical card enough?

A. They complement each other. A medical plan pays for your hospital bills for medical or accidental incidents that affect your well-being. A CI Plan on the other hand covers the expenses that your medical plan does not, as well as well as the additional costs that comes along should you be diagnosed with a Critical Illness. For example, if your illness causes loss of income due to inability to work, you can use the benefit payment to cover your monthly expenses, such as monthly bills and mortgages. You can also use the payout for alternative treatment, which is usually not covered in a medical plan. You can also use it is a top-up for your medical bills if you have reached the annual limit of your medical plan.

Q: So, it’s like easy access to funds? For instance if you have reached your annual limit, you can just get money from CI to cover the extra?

A: Once you are diagnosed with a CI that is covered under your plan, you usually can already submit the claim. And once the operator disperses the money to you, you can use it however you need to. So let’s say you don’t have a CI plan and are diagnosed with a Critical Illness, you would have to tap into your savings should you be incapacitated and in need of home nursing care. Having a CI plan will help to cover things like these. Most people don’t think about these hidden costs until it’s time to leave the hospital.

Q: If I’m hospitalised and diagnosed with cancer, and the specialist recommends chemotherapy, my medical card won’t cover this?

A: Chemotherapy and most hospital treatment are covered under the outpatient cancer care of a medical plan. However, please check if your plan covers outpatient cancer care for example. A CI plan will help take you through the period after your cancer is diagnosed, and remedial care is needed. You will need it all the more if you exhaust the annual limit on your medical plan or want to try alternative treatment, which is usually not covered in a medical plan.

Q: What should one look out for when looking for a CI Plan? What features should it have? Any exclusion causes to watch out for?

A: Most CI Plan in the market cover 36 types of illnesses. Some may cover up to 45. The more CI covered, the more contribution you need to pay. The most common critical illnesses are kidney failure, stroke, cancer, heart attack, and other cardiovascular diseases. If you want to get a CI Plan, do your own research and get your information from reliable sources, for instance a financial comparison website or directly from Takaful operators. Read reviews or recommendation from financial blogs and make comparisons.

When you meet up with the agent, ask questions to help you make the right decision. Some important questions that you should ask are, “What is the waiting period for specific illnesses?”, “What are the exclusions?”, “Is the benefit payment staggered or paid as a lump sum?”, “Can you upgrade the plan later?”

Q: Can you give an example of an exclusion?

A: Existing conditions. For example, symptoms that already started before you got covered.

Q: How much should I set aside for this, say on a monthly basis? Let’s say, I’m a woman in my 40s and given the kind of illnesses that I could have?

A: The general rule is that your CI coverage should be three times your annual salary. This is because usually it takes three years for a CI patient to adjust to his or her lifestyle and to recover. There’s also a possibility that you may not be able to work so you can use the lump sum payment to cover the expenses for loss of income.
If budget is a concern, you can take a CI Plan as a rider because it is usually cheaper than a standalone plan. Later on, when your disposable income increases, make sure you upgrade the plan or add another CI Plan so that you are well covered. Most importantly, get this plan when you are healthy so that you can get full coverage when you need it the most, meaning there would be no exclusions. A CI plan is not a painkiller.

Q: You mean to say that when a person starts off on a small income, it is better to take CI as a rider and later on top up the monthly contribution towards that rider?

A: That depends on the plan. Usually you can top-up but if you can’t, then you can invest in a new CI standalone plan. Just remember not to lapse on your existing plan.

Q: Must I get CI plan from the same company as my medical card or my takaful plan?

A: It’s a personal choice. Having all plans issued by one Takaful Operator (TO) might be convenient. On the other hand, you might get a better CI plan with more suited benefits from another TO. My advice is to shop around before you make a decision and be proactive by reviewing your current plans every year to ensure you always have enough coverage to suit your current and future lifestyle needs.