What is the primary purpose of critical illness insurance?

The primary purpose of critical illness insurance is to provide a lump sum benefit upon diagnosis of a severe illness. This type of insurance is specifically designed to offer financial support when an individual is diagnosed with a critical condition, such as cancer, heart attack, or stroke. The lump sum payment can be used by the policyholder to cover a variety of costs, including medical treatment not covered by other insurance, living expenses during recovery, or any other expenditures the policyholder might face as a result of their diagnosis.

This financial assistance allows individuals to focus on their recovery rather than worrying about their financial obligations during a challenging time. Critical illness insurance is distinct from other forms of insurance that might cover ongoing medical expenses or provide income replacement, as its primary focus is solely on the one-time payment related to specific severe health conditions.