This makes it easier than long-term or disability care insurance because there’s no need for ongoing paperwork or claims. Major medical insurance doesn’t cover all the expenses associated with a serious illness, so this is important, Finn says. “A long, costly recovery period after a serious illness could affect an employee’s ability to bring home a paycheck, which makes it even harder to pay for needed treatment, plus other day-to-day living expense,” Finn says.

“A good critical illness plan can provide benefits to help employees protect their family’s financial health while they concentrate on recovery.” Plus, studies have showed that people who aren’t under financial stress heal more quickly. According to Colonial Life claims statistics, heart attacks, stroke and coronary artery bypass surgery together made up 58 percent of critical illness claims in 2010. But more and more people are surviving these ailments, so coverage is going to be needed. These benefits speak to a new generation.

“Too many benefit offerings are based on old traditions and need to change to reflect current realities,” explains Jesse Slome, executive director of the American Association for Critical Illness Insurance, a national trade organization. “Improvements in medical care and emergency treatments have dramatically reduced the risk of dying among employment-aged Americans and lowered the chances of a claiming on one’s long-term disability policy,” Slome says.

“At the same time, the risk of surviving a critical illness such as cancer or a heart attack during one’s working years continues to rise. Employers are taking this into account and we’re seeing increased interest and slow but steady penetration for critical illness insurance into the workplace.” In fact, recent data from Unum showed that return-to-work rates for people who are diagnosed with some of the most prevalent cancers have improved.

In 2001, for example, 47 percent of Unum’s long-term disability customers who were diagnosed with breast cancer returned to work. For claims received in 2008, the number was 52 percent. “Years ago, if you had cancer, you very likely weren’t coming back to work,” says Robert Jacob, director of health and productivity for Unum. “With advances in treatment and early detection, the questions surrounding cancer and the workplace have evolved.”

Brokers can sell critical illness insurance in several ways, according to Wilma Anderson:

1) As an additional product for the individual who cannot get enough disability insurance coverage. A $500,000 policy will pay out as one lump sum after a critical illness is diagnosed, such as a heart attack, cancer or stroke. The policyholder can use those funds for family needs, or even to fund the business operational costs until they are able to resume working.

2) Most policies are sold to individuals who are 40-55, so it’s a product that can open many doors to additional sales for the broker.

3) Critical illness coverage is a wonderful product to sell to groups of attorneys, doctors, dentists, and closely held businesses who want to protect their production/revenue from a partner. Some companies end the coverage at age 65 when the average person retires, one company keeps the policy in force for the policyholder’s entire life.

4) The critical illness product from American General can be sold to a younger client who never wants to buy a long-term care policy. Why? At age 70, the benefits from the critical illness policy change to a pool of money they can access when the policyholder has a permanent loss of 2 ADLs. Benefits are paid out in one lump sum, allowing the policyholder to have complete freedom how to use the funds.