Getting sick can cost more than you think

May 6, 2022

For business owners, plan administrators, and sponsors

By Eric Egan
Product Director

Many of us may not consider the full cost of illness until a loved one gets sick. The truth is that it can present a very personal challenge.

I recently spoke with two colleagues about the toll illness had on their families. Brittany shared the struggle of caring for her mother during college.

“I couldn’t manage school, hospital visits and a part-time job, so I had to quit my job,” Brittany said. “I was missing income yet spending more on gas, parking and things like hospital cafeteria food. It really added up.”

These out-of-pocket expenses can become a financial burden on a family already working with a reduced income. My colleague Viviane tallied the travel costs for her husband’s treatment while juggling the care of her two small children.

“In six months, the costs were over $5,000,” Viviane said.

This can force members to make costly financial decisions.

“We stopped contributing to our retirement savings to make ends meet,” Viviane said.

The challenge is making sure people have enough financial protection. That starts with knowing the government may not cover everything if you get sick. So, what are the options?

Many employers offer group disability insurance that will pay a portion of your salary if you’re unable work. And, more and more, companies offer optional critical illness insurance in their group plan that will pay a lump sum if you’re diagnosed with a covered illness.

These options can allow members’ focus to remain on caring for loved ones rather than financial concerns. But I’ve written about how employees can often gloss over these options when signing up for benefits.

That’s why member education is very important. It can help them understand the difference between the two types of coverage and why they should consider both.

Here’s a quick breakdown:

Disability insurance Critical illness insurance
Replaces a portion of your income if you can’t work.  Pays a lump-sum amount if you’re diagnosed with a covered illness.
Typically provided as part of a group plan, at either employer or employee’s expense. If offered in a group plan, typically an employee-paid option.
Could be tax free depending on who pays the premium.

Lump-sum amount provided tax-free.

Base plans pay only a percentage of income, potentially leading to a shortfall in money. Lump-sum amount to use at plan member’s discretion.

Manulife can also help. We have member educational materials and offer webinars and other educational sessions for employees. We can also be on-site (or virtual) if you’re hosting a wellness fair.

You can also help underscore what people face when they get sick. Every company has a Brittany or a Viviane. Invite them to share their stories. The more people understand, they’ll see the benefits and protection insurance can offer.

And if your organization wants to start offering coverage, now is a great time. We are enhancing our critical illness coverage this year.

We will cover 25 conditions with faster eligibility. Only a 14-day survival period will be required for benefit payment. That is half the time previously required.

Our coverage will also allows for multiple-event payments and second-event cancer eligibility.

Multiple-event payments means that if you make a claim for a covered condition, you remain eligible for additional payments for other covered conditions.*

Second-event cancer eligibility means that if you make a claim for cancer and are treatment-free for five years, you may be able to make a second claim for a different type of cancer.*

As a plan sponsor, you can choose a plan design that extends this critical illness insurance to members’ spouses in various amounts and increments.

Our critical illness insurance covers the following conditions:

Cancer critical illness conditions
Cancer (life-threatening)
Cardiovascular critical illness conditions
Aortic surgery
Coronary artery bypass surgery
Heart attack (myocardial infarction)
Heart valve replacement
Congenital heart disease (for which corrective surgery has been performed)
Stroke (cerebrovascular accident)
Other critical illness conditions
Alzheimer’s disease
Aplastic anemia **
Bacterial meningitis **
Benign brain tumour
Kidney failure (end-stage renal disease)
Loss of independent existence **
Loss of limbs
Loss of speech
Major organ or bone marrow failure and on waiting list for transplant
Major organ or bone marrow transplant
Motor neuron disease
Multiple sclerosis
Occupational HIV infection
Parkinson’s disease
Severe burns
Cerebral palsy
Cystic fibrosis
Down syndrome
Muscular dystrophy
Type 1 diabetes mellitus

Please reach out to your Manulife representative for more information.

* Conditions, limitations, and exclusions may apply. See policy for details.

** This condition is not covered in our existing optional critical illness insurance. This condition will be covered in our enhanced optional critical illness product. Conditions, limitations, and exclusions may apply. See policy for details.

The testimonials mentioned in the article are provided by Manulife employees.

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