Retirement, Investments, & Insurance for Individuals Employee benefits essentials Critical illness insurance
Critical illness insurance
A person with their hand on another person’s shoulder, offering them comfort during a critical illness.
What is critical illness insurance?

A serious illness can happen to anyone. The last thing you want to worry about amid the physical and emotional toll is your financial situation. Critical illness insurance helps offer additional financial security beyond your medical and financial coverage. It provides a lump-sum cash benefit if you’re diagnosed with a specific critical illness after your plan starts.

How does critical illness insurance work?

1. Purchase benefit through your employer

Buy this coverage through your company at a lower group rate that comes straight out of your paycheck.

2. File your claim

If you or an insured dependent are diagnosed with one of the covered illnesses, you can easily submit your claim online. Learn more about how to submit a claim.

3. Receive your benefit

If your claim is approved, you’ll receive a lump-sum payment that you can use however you choose.

How our coverage can help.

Cancer
Family with baby who benefited from critical illness insurance.

Jordan has a busy job, lives in a small town near the city, and is married to Logan. Logan works full-time and they have two young children. When Jordan was diagnosed with cancer, Logan began to worry about how they’d pay for their extra out-of-pocket expenses.

But with help from Jordan’s critical illness insurance, their family could do what they needed to get through this challenging time, instead of losing sleep over additional expenses. Because they could use the coverage’s $10,000 cash benefit for anything, they chose to put it towards the extra childcare needed during Jordan’s treatments and the trips back and forth to the hospital in the city.

Heart attack
Doctor talking to his patient about his critical illness.

While at work, Sam experienced chest pain and was rushed to the hospital, where he was diagnosed with a heart attack. Sam was worried because he’d already taken money out of his savings to help with medical bills.

While filing his disability paperwork, Sam realized he also had critical illness insurance, so he submitted a claim. Sam’s claim was approved, and he received $10,000 that he could use however he wanted to. Sam was able to put the money back into his savings and focus on his recovery instead of worrying about the financial burden of his medical bills.

Organ failure
Doctor walking his patient through treatments for his critical illness.

Charlie was recently diagnosed with end-stage kidney failure and required dialysis. Because of Charlie’s major organ failure, he was placed on a transplant list and successfully received a new kidney. After this major surgery, Charlie needed time to recover and return to his new normal.

Charlie had forgotten he purchased critical illness insurance during his company’s annual enrollment, and his employer reminded him to take advantage of it. He submitted a claim, and it was approved in the amount of $20,000 that could be used for anything he needed. Charlie chose to use the funds to help pay his medical bills and his family’s out-of-pocket expenses while he recuperated.

The financial support from Principal® critical illness coverage allowed me to focus on my recovery without the added stress of financial burdens.
Eric Lamb, claimant
Three people smile warmly at the camera.
Cash benefit that can be used for whatever you need.

There are no restrictions on what you can use the lump-sum payment for—it’s completely up to you. This can be used for any out-of-pocket expenses including medical deductibles and copayments, childcare, and lost income.

Frequently asked questions
What does critical illness insurance cover?

This benefit covers more than 40 illnesses (PDF) including various types of cancer, mental health disorders, infectious diseases, and more.

How do I get paid?

After your benefit starts, if you are diagnosed with a covered illness and file a claim, you’ll receive a lump-sum payment that can be used any way you decide.

How can I use my lump-sum payment?

Your cash benefit can be used for:

  • Medical deductibles and copayments
  • Travel costs for medical treatments
  • Home healthcare needs
  • Childcare
  • Prescription costs
  • Lost income of spouse or caregiver
  • Other out-of-pocket expenses
Do I need a medical exam to qualify?

When you purchase at enrollment time, you’re guaranteed coverage. Proof of good health is not required during initial enrollment.

Why should I buy this through my employer?

When you purchase critical illness coverage at work, you get several advantages including:

  • Group rates that are less expensive than if you purchase the insurance on your own
  • A cost that’s automatically deducted from your paycheck
Who should consider this coverage?

While critical illness insurance can be a good idea for anyone, the following individuals could especially benefit from this coverage:

  • People with a family history of serious medical conditions like cancer, heart disease, or stroke
  • Primary income earners who want to protect their family’s financial stability if they become seriously ill
  • Those with high-deductible health plans who want additional financial protection

Learn more.

Ready to unlock the full potential of your benefits? Talk to your employer or financial professional about benefit costs and how to enroll.

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