PRODUCT: Aflac Lump Sum Critical Illness insurance policy
BEST RATING: A+ (Superior)
AVAILABILITY: Coverage is available through Aflac-appointed agents.
FOCUS: More Americans (40%) fear the cost of treating a serious illness than becoming ill in the first place (33%), according to a nationwide poll by the West Health Institute and NORC at the University of Chicago.
Meanwhile, nearly half of all U.S. adults have some form of heart or blood vessel disease, meaning critical illness is a reality many people will face in their lifetime. But with out-of-pocket health care costs on the rise, demand for critical illness insurance increased 37% to $652 million in 2017, according to an industry survey by Gen Re.
To meet this need, Aflac recently launched its latest Lump Sum Critical Illness product, which has been redesigned to include new riders and a wider range of benefits to offer a holistic approach to recovery and care. “Aflac wants to help ensure health care costs are not a deterrent to people taking care of their health,” says Wendy Herndon, second vice president of Product Solutions at Aflac.
Aflac has offered critical illness coverage for years, but this refreshed offering takes a more holistic approach to providing benefits to policyholders.
It also makes the product “more competitive for agents and brokers licensed to sell our products,” Herndon explains. “Our products help consumers with expenses health insurance doesn’t cover, like deductibles, copayments or daily living expenses, with all benefits paid directly to the policyholder, unless otherwise assigned.”
COVERAGE DETAILS: When paired with Aflac’s Cancer Protection Assurance policy, coverage includes benefits for up to nine conditions. Highlights of the new product include:
- Lump sum payment upon diagnosis, allowing policyholders to focus on recuperation
- Building benefit, which means the policy increases in value every year for up to 10 years, to be paid out when policyholders need it most
- Hospitalization Rider, which provides additional benefits to help policyholders cover everything from ambulance costs to physical therapy, easing the financial stress associated with an unexpected illness
- New Event Recovery Rider, which pays a lump sum benefit for up to three months to help cover expenses from being out of work
“We know that getting better does not typically happen in a day, which is why our critical illness coverage offers a holistic approach to recovery and care,” Herndon says.
UNDERWRITING: Coverage is available to applicants ages 18-69, with premium rates that are age-banded and categorized for tobacco and non-tobacco product use. Six underwriting questions relate to the covered conditions.
MINIMUM PREMIUM: Premiums vary depending on the lump sum benefit amount and riders selected.
TARGET: The ideal client is an adult over the age of 30 who may be at risk or want to be proactively prepared for any of the following conditions: heart attack, sudden cardiac arrest, kidney failure, major organ transplant, paralysis, coma, stroke, bone marrow transplant and internal cancer.
“Given the growing cost of medical care, high-deductible health plans and out-of-pocket medical expenses, our coverage can be ideal for people looking for additional financial protection,” Herndon adds. “A serious illness, such as a heart attack, can leave the average American with tens of thousands of dollars in out-of-pocket costs, even with health insurance.”
COVERAGE TERRITORY: AK, AL, AR, DC, DE, FL, GA, GU, HI, IA, IN, KS, LA, MI, MS, MT, NC, ND, NE, NM, NV, OK, SC, SD, VT, WI, WV and WY.
CONTACT: Wendy Herndon, second vice president of Product Solutions at Aflac.
Jacquelyn Connelly is IA senior editor.