knowledge topics
Critical Illness Insurance
KNOWLEDGE EXPECTED OF: CFP® Professionals Only
- Identify types of critical illness insurance policies that may be available.
- Individual
- Group
- Identify that an individual critical illness insurance policy may be obtained from an insurance company.
- Identify sources of group critical illness insurance policies, such as:
- Insurance companies
- Employer-sponsored
- Creditor protection
- Association-sponsored
- Explain models that a critical illness insurance policy may use, such as:
- Permanent plan
- Term plan
- Identify factors that may impact an individual’s ability to qualify for critical illness insurance.
- Medical
- Age
- Health history
- Family health history
- Financial
- Benefit amount
- Financial need based on current income and net worth
- Lifestyle
- Medical
- Identify policy provisions associated with critical illness insurance contracts, such as:
- Covered illnesses
- Term
- Conversion options
- Provision of benefits
- Premiums
- Exclusions
- Riders
- Identify illnesses that may be covered by a critical illness insurance policy, such as:
- Life-threatening cancer
- Heart attack
- Stroke
- Other life altering illnesses/diseases
- Define terms associated with the continuation of a critical illness policy, such as:
- Non-cancellable
- Guaranteed renewable
- Conditional renewable
- Cancellable
- Define terms associated with the provision of a benefit under a critical illness insurance policy, such as:
- Benefit amount
- Waiting period
- Covered illnesses
- Exclusions and limitations
- Identify terms associated with the conversion options that may be available on critical illness insurance policies, such as:
- To permanent critical illness insurance
- To long-term care
- Identify factors that may impact the premium of a critical illness insurance policy, such as:
- Age
- Sex/Gender
- Current health
- History of health
- Type and number of covered illnesses
- Benefit amount
- Type and number of riders
- Identify premium pay periods on which a critical illness insurance policy may be based, such as:
- Lifetime of insured
- Limited pay
- Specific term
- Identify exclusions that may be included in a critical illness insurance policy, such as:
- Acts of war
- Criminal offences
- Intentional abuse of drugs and alcohol
- Intentionally self-inflicted injuries
- Attempted suicide
- Explain the purpose of riders that may be added to critical illness insurance policies, such as:
- Waiver of premium
- Return of premium (on death, surrender, maturity of policy)
- Automatic benefit increase
- Identify types of approvals upon adjudication of an application for critical insurance, such as:
- Approved as applied for
- Approved with revision to terms of policy
- Increased premium
- Reduced benefit amount
- Exclusions based on medical history or lifestyle
- Explain the factors that may be considered in structuring disability insurance coverage, such as:
- Length of recovery period
- Cash flow needs
- Debt obligations
- Goals (i.e. funding retirement or education goals)
- Ability to self-fund during recovery period (i.e. draw on savings, sale of assets)
- Other sources of income during recovery period
- Affordability
- Estimate the need for critical illness insurance.
- Explain characteristics that may be used when comparing individual and group critical illness insurance policies, such as:
- Ownership and control
- Cancellability
- Period of coverage
- Portability
- Termination options
- Application requirements
- Covered illnesses
- Evidence of insurability requirements
- Time of underwriting
- Benefit recipient
- Optional riders
- Premium guarantees
- Premiums
- Tax impact
Glossary of Verbs (mouse over to see definition)
-
Define
To state exactly the meaning of
-
Identify
To be aware of / to recognize and correctly name / to locate an appropriate resource
-
Explain
To make clear the meaning of / to describe something in more detail or reveal relevant facts or ideas related to it
-
Compare
To note the similarities and differences between two or more things
-
Estimate
To determine an approximate value for
-
Calculate
To find the value using mathematics
-
Convert
To change from one form or purpose to another
-
Evaluate
To reach a conclusion or make a judgement through careful study
-
Interpret
To give the meaning of / to construe or understand / to translate orally
