Critical illness insurance has come a long way, baby.
Launched in 19831, the first critical illness policy covered four things: cancer, stroke, heart attack and coronary bypass surgery.
Today, there are countless providers and a much more extensive list of commonly covered illnesses. Good thing, too, as health care costs and the number of various critical illness cases are also on the rise – possibly growing more than 15 percent by 2025.2
The current state of critical illness insurance
Here are three trends making this benefit, which provides a lump-sum cash payment for a covered diagnosis, popular with both employees and employers.
1. One size does not fit all
Many of today’s workforces have at least four generations: baby boomers, generation X, millennials and generation Z. And each generation has different needs, interests, experiences – even critical illnesses.3
Many millennials are not thinking about heart attacks and strokes. And boomers likely don’t have childbirth (and neonatal intensive care) on the brain.
Providers may want to consider adding more generationally relevant critical illnesses to their plans. Which is a nice segue into the next trend.
2. In today’s hot job market, employees are swayed by better salaries — and benefits
Competition for talent is fierce, and benefits are a way to stand out.
Did you know critical illness insurance is among employees’ top three most-wanted supplemental benefits?4 According to a 2022 Workforce Benefits Employer Benchmarking Study by LIMRA, the total average participation rate for eligible employees getting critical illness coverage is 41 percent.5
Since voluntary benefits like critical illness are more popular than ever, it makes sense that employers offering critical illness coverage experience greater talent retention and engagement.5
In fact, according to a recent survey, HR professionals believe offering voluntary benefits like critical illness will retain employees (83 percent), engage employees (72 percent) and attract new talent (72 percent). They also believe doing so will save employees money (63 percent) and increase productivity (53 percent).5
3. COVID-19 has increased demand
You didn’t think we could avoid talking about COVID-19, did you? The pandemic is a big reason why more people purchase critical illness insurance.6
Moreover, COVID-infected patients are more prone to serious illnesses such as heart attack, cancer and others due to weakened immune systems. Notably, the demand for critical illness/care insurance increased during the pandemic.7
Here’s an interesting fact: A recent survey found that respondents who had COVID-19 were more likely to purchase critical illness coverage (26 percent) than those who hadn’t (12 percent).6
Over the last 39 years, critical illness insurance has become one of the fastest growing voluntary benefits available today. And while it’s come a long way, there’s no doubt it will continue to evolve.