There are two components with any wealth management strategy; growing your assets and protecting them. Many financial advisors focus on the growth side while ignoring the protection side. But what good is accumulating wealth if you cannot protect it?

Protection can be done by: 1) Investment strategy changes – adjust your holdings, diversify and reduce volatility; 2) Insurance: health insurance, life insurance, critical illness insurance. We’ll focus on the second, using critical illness insurance as a key component of your wealth management strategy.


Critical illness insurance pays you a lump sum benefit in the event of a critical illness. The benefit replaces lost income, covers expenses that are not covered with health insurance and anything else as you see fit.

It also works as a life insurance policy, where the benefit goes to your family in the event of death to be used for final expenses, among other things.


A lump sum benefit is paid to you upon a critical illness diagnosis. This includes heart attack, stroke, cancer, heart disease & respiratory diseases. However, there are more conditions that trigger the payout such as permanent disability, severe trauma, coma, impairment of daily living, organ failure and transplant, loss of vision and third-degree burns. But to qualify, the illness must meet minimum severity criteria.


People live longer now than ever before, with the global average life expectancy at 72 years old in 2019. Critical illnesses are also more survivable these days with modern medicine. Combined, getting one or multiple critical illnesses within a lifetime is very high.

In a 2017 Global Mortality report, 73 percent of global deaths were caused by non-communicable diseases such as cancers, cardiovascular diseases, respiratory diseases and diabetes. Heart disease and cancer alone accounted for 49 percent of all global deaths. Next was non-communicable diseases at 19 percent and then injuries at 8 percent.

Four questions to ask yourself in the event of a critical illness:

1) What are the immediate effects on me and my family?

There are immediate medical bills, which your health insurance should cover. There are also ongoing care, therapy, and many other ancillary expenses that arise following a critical illness.

2) What happens to my job?

You may be entitled to full or partial salary for a period of time. Your contract will have an incapacity clause that outlines what would happen if you’re unable to work.

How would you replace that lost income if it was 3 months, 6 months, 1 year, or, worst case, indefinitely?

3) What happens to my health insurance?

If you have insurance through your employer, if you lose your job, then so too goes your health insurance.

You usually cannot keep your policy if you leave a company. If you apply with a new provider, they will exclude any pre-existing severe conditions. You’re now on the hook for the medical expenses that were previously covered. If you have personal health insurance, then your policy will continue.

4) How is my financial future affected?

Do you need to dip into your retirement? What about your retirement prospects now? How is your family negatively financially affected? Do you have to downsize your lifestyle? Will there be a legacy to leave?

With something likely to occur, it’s time to make critical illness insurance part of your wealth management strategy. Unlike life insurance, this directly affects you, not just your dependents. [C]

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Tim Burrill
Membership Manager & Executive Assistant
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