As Life Insurance Awareness Month ends, Critical Illness Awareness Month begins with the turning of the calendar page from September to October.
A critical illness is a life-threatening condition, with the three main critical illnesses being cancer, heart attack and stroke. According to Critical Illness Planning, 75% of adults over age 40 will be diagnosed with a critical illness in their lifetime.
The CI market is larger than many know with about 5 million current policyholders as of Jan. 1, 2020. The number has increased compared to prior years, according to data from the American Association for Critical Illness Insurance’s 2020 report.
Jesse Slome, director of the AACII, which advocates for the importance of critical illness planning and has coordinated CI Awareness Month since its inception in 2011, says 1.6 million Americans purchased critical illness insurance in 2019, with most purchasing coverage through their workplace.
October was selected to highlight the need for CI coverage for several reasons, according to Slome.
“We wanted to create heightened awareness towards the end of the year. Many employers offer critical illness insurance plans to their employees in the Fall,” he notes. “Secondly, October is Breast Cancer Awareness, a good tie in.”
He also notes that November is Lung Cancer Awareness Month. “We believed October was a perfect time to create awareness and build momentum. We know a grassroots effort takes time to build we believed this was an ideal time of the year.”
Latest CI stats
There was about $1.1 billion in in-force coverage in 2018 for traditional and worksite/group products combined with $460 million of new sales premium in 2018.
AACII reports that the average age of U.S. critical illness insurance buyers is 43, based on data shared by Gen Re’s 2018/2019 U.S. Critical Illness Insurance Market Survey.
- Average age for new buyer of traditional CI insurance: 46.6
- For Group/Worksite using attained age pricing: 41.5
- Group/Worksite using issue age: 41.9
Slome says the average critical illness insurance new benefit amount varies, with traditional individual policies purchased through an insurance agent tending to be significantly larger.
Critical illness insurance policies purchased through the worksite tend to be smaller. They ranged from $12,961 for policies using attained age pricing to $15,408 for policies using issue age pricing.
At the time of claim, the average age of a traditional individual claimant was 55.1 years. For Group/Worksite attained age pricing, the average age was 47.8. For Group/Worksite issue age pricing the average claimant age was 50.5, according to the Gen Re survey.
Cancer is the reason for half (50%) of all claims from traditional individual policies. It is also the reason for nearly two-thirds (64%) of Group policies (attained age pricing).
Reasons for claims for Group (issue age pricing policies) are cancer (47%), heart attack (18%), stroke (8%) all other (27%).
To view all the latest CI data, go to https://criticalillnessinsuranceinfo.org/critical-illness-insurance-statistics-2020/.