1. What is critical illness insurance?
2. What is covered under this plan?
3. I already have life, disability and medical coverage, why do I need this?
4. What is the history of this product?
5. Some Canadian Statistics on critical illnesses
And did you know that:
7. Links




1.What is critical illness insurance?

People insured under this plan receive a lump sum of tax-free cash when they are diagnosed with a covered condition and survive.

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2.What is covered under this plan?

Basic coverage:

Heart attack


Depending on the insurance carrier chosen, additional illnesses can be covered, such as:
Multiple Sclerosis
Motor neuron disease (ALS/Lou Gehrig`s disease)
Parkinson's disease
Alzheimer's disease
Loss of speech
Loss of limbs
Coronary artery bypass surgery
Kidney failure
Major organ transplant
Major organ failure on a waiting list
Severe burns
Late onset insulin dependent diabetes (after 45th birthday. Must be insulin dependent for 12 months. 50% of sum insured is paid for this covered impairment).
Loss of Independence
Aortic Surgery
Heart Valve Replacement
Benign brain tumor resulting in permanent deficit to neurological system
Occupational HIV infection
Additional benefits (vary by carrier chosen):
Premium refund at specified age rider
Waiver of premium rider

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3. I already have life, disability and medical coverage, why do I need this?

Critical Illness is neither life or disability insurance, nor does it replace your medical coverage.

Life insurance is really "death" insurance, the beneficiary receives the proceeds of the life insurance policy after a policy holder dies.

Disability insurance pays out an amount of money on a monthly basis to a disabled person while they are disabled for a specific period of time, i.e. $1,000 or $2,000 a month for 5 years, 10 years, to age 65 etc.

Critical Illness insurance pays out a lump sum of money as soon as a person is diagnosed and survives a covered illness for 30 days.

Although Canada`s health care system is better than a lot of countries, our system is undergoing major changes. Do you think our health care system is getting better?

Critical Illness insurance does not replace your medical insurance, but enhances it by providing you with peace of mind at a time that you need it the most. It can provide you with options that would otherwise not be available to you.

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4. What is the history of this product?

The first Critical Insurance products were devised in 1983 in South Africa and are now sold widely in the United Kingdom, Australia, Ireland, Malaysia, Japan and North America.

Critical illness insurance was conceived by Dr. Marius Barnard, brother of Dr. Christian Barnard, the famous heart surgeon. He found that patients were now living, but their finances were totally depleted. Being a doctor, he was well aware that financial stress after a difficult operation also had bad medical consequences.

One of the greatest virtues of Critical Illness Insurance is that the product is not designed by insurance companies, but by medical professionals with intimate knowledge of the consequences of a critical illness.

Critical Illness plans were introduced to the United Kingdom in 1987 and in 1998 alone, 843,000 people purchased it.

In 1991 in Australia 4500 policies were sold, in 1998 that number exceeded 140,000

When Critical Illness was first introduced in Japan, 500,000 policies were sold in the first 10 months. 6 million were sold in the first 4 years.

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5. Canadian Statistics

Heart Attack

1 in 2 Canadians will contract heart disease
1 in 2 heart attack victims are under the age of 65
95% of heart attack victims survive the initial occurrence


50,000 Canadians suffer a stroke each year
1 in 20 Canadian run the risk of having a stroke before age 70
1 in 3 stroke victims are under the age of 65


135,000 new cancer cases are estimated in Canada for the coming year
1 in 3 Canadians will develop a life threatening cancer
2/3 of the cost of cancer treatment is not covered by provincial medical plans
(Source: Heart & Stroke foundation of Ontario, National Cancer Institute of Canada, Statistics Canada)

Parkinson`s Disease

Approximately 80,000 to 100,000 Canadians have Parkinson`s
20% of patients are diagnosed under age 50
5 to 10% are diagnosed under age 40
Most (government and private) drug plans limit their coverage for patients with Parkinson`s

Alzheimer Disease

316,500 Canadians have it now
by the year 2021, more than 592,000 Canadians will have it
Almost 25% of Canadians have a family member with the disease
$3.9 billion per year is spent on persons with Alzheimer`s in Canada
Average annual cost of care for a person with Alzheimer disease:
$36,794 for severe disease
$25,724 for moderate disease
$16,054 for moderate to mild disease
$9,451 for mild disease

Organ Transplant

Canada`s aging population and growing number of cases of Hepatitis C and diabetes will lead to a 152% increase in the need for organs over the next 2 decades. However, a slowing death rate means the number of organs donated will rise by only 12%.

This year, 5,441 Canadians who need transplants won't get them. By the year 2020, 18,278 people will be waiting for organs, but only 2,028 will be available, leaving a "transplant gap" that will have quadrupled.

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6. And did you know that:

more than 50,000 people in Canada have multiple sclerosis.

MS is the most common neurological disease affecting young adults in Canada. MS strikes between 20 and 40 years of age, and affects twice as many women as men.

30,000 Canadians suffer from paralysis of 2 or more limbs

1 in 4 Canadians will suffer from kidney disease

Despite the availability of critical illness coverage, you may wonder whether the need to protect oneself against such hazards is as great as the need for life and disability insurance.

Many people do not realize that there is at least a one in five chance of a male under age 40 suffering a critical illness before the age of 65. If anything, this statistic is probably understated.

In the U.K., one of the markets where Critical Illness Insurance products are most entrenched, industry statistics indicated that the average age of claimants in the last three years was 41. Even worse, one in four claimants was under the age of 35!

In general, the probability of surviving a critical illness before the age of 65 is about twice as great as that of dying. For those who suffer a stroke for example, 75% of the victims survive the initial event. There are over 200,000 stroke survivors in Canada today.

When examining the financial consequences of prolonged disability, it is important to realize that the costs go far beyond what is needed for hospitalization and immediate medical attention.

What would it take to maintain your quality of life?

Could you afford to pay off your mortgage and your debts?

What about 24-hour care by an attendant or nurse should this be necessary?

What about remodeling your home and car?

For example, a victim of a stroke or paralysis will need to install lifts, wheelchair ramps and automatic doors. These are all features which no normal house is designed to accommodate. Don`t forget that these financial considerations will affect not only your bank balance, but also your health. Acute stress diminishes your chance of recovering from a critical illness or disability. Flexible levels of Critical Illness coverage enable you to cover full costs that could easily run into hundreds of thousands of dollars.

It is vital to stress that life and disability insurance on their own cannot meet such needs:

This last feature makes it very important to decide on the level of critical illness coverage you need. Nonetheless, it is clear from the above comparisons that critical illness coverage is adapted to meeting large, immediate and unexpected expenses in a way that simple disability coverage can never do.

In the last decade or so insurance companies have admittedly made life insurance policies more flexible to deal with the needs of the terminally ill. It is now possible to structure such a policy so that a fixed percentage of the policy`s benefits is advanced when a fatal illness is diagnosed, the remainder being paid after death. Although a living benefit of this kind is valuable, it may not be enough to cover the costs of living with a disabling illness for years; and, even if it is, the money left to your dependents after your death will have been severely depleted. Long-term care insurance may prove too inflexible as those who suffer from a critical illness often make full recoveries in varying degrees of time.

Although Critical Illness Insurance is different from normal life, disability or health insurance policies it can readily be integrated with any policies you already have.

Many sales have been made on an acceleration basis, which means that an agreed upon percentage of a life insurance policy's benefits is paid upon diagnosis of a critical illness. As the new product made headway in the marketplace, freestanding policies were devised. With such policies there is no life insurance coverage; a lump sum--determined by the amount of coverage desired--gets paid after an agreed upon period from diagnosis of a critical illness has elapsed. Customers now also have the added benefit of being able to add a critical illness component to existing life insurance policies so that benefits are paid upon both the diagnosis of a critical illness and upon death.

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7. Links

Critical Illness Insurance Centre

Critical Illness Research Tools
Check Canadian Cancer Statistics

Canadian Life Insurance Companies
Canada Life
RBC Insurance
Transamerica Life

Canadian Market Information
Advocis Consumer Site

PLEASE NOTE: The information being provided is strictly as a courtesy. When you link to any of these web-sites provided here, you are leaving this site. Our company makes no representation as to the completeness or accuracy of information provided at these sites. Nor is the company liable for any direct or indirect technical or system issues or any consequences arising out of your access to or your use of third-party technologies, sites, information and programs made available through this site. When you access one of these sites, you are leaving Trenton Financial Services web-site and assume total responsibility and risk for your use of the sites you are linking to.

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Victoria BC V8W 2H7
E-mail: trenton@trentonfinancial.com

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