In the United States, somebody has a heart attack every 40 seconds, according to 2025 data from the American Heart Association.
This statistic is perhaps not as alarming as the cost of a heart attack, which can run tens of thousands of dollars. A 2024 study in Circulation, a medical journal from the American Heart Association, found the median cost of hospital care following a heart attack was $29,500 per patient in 2018. Add the rising costs of medical care and inflation to the mix, and that number is likely much higher now.
If you had a heart attack tomorrow, how would you pay for it?
Critical illness insurance is one way to answer that question.
What is critical illness insurance?
Many Americans are surprised to discover medical insurance won’t cover all their expenses. Think of critical illness insurance as a way to bridge the gap between your primary health insurance and out-of-pocket costs. It’s designed to make your recovery easier financially and take care of costs you might incur as a side effect of getting sick.
With critical illness insurance, you’ll get a cash payout if you suffer a serious illness. The list of covered illnesses varies, but heart attacks, strokes and cancer are the big ones. The coverage also typically kicks in if you experience organ or kidney failure.
The money can be used however you like. You could funnel it toward day-to-day expenses or deductibles, copays and procedures. Some people spend the money on rehabilitation, in-home care and lifestyle expenses to get healthier, such as programs to quit smoking. You might prioritize child care or cleaning services to allow you to recuperate.
How critical illness insurance fits into a financial plan
Critical illness insurance can prevent you from dipping into your savings to meet your health insurance deductible. For example, if your plan has a $10,000 deductible, you might buy a $10,000 critical illness policy to plug that gap.
One of the main selling points is there’s typically no waiting period. This sets it apart from long-term disability insurance, which generally has a three-month waiting period.
Critical illness insurance has limitations, though. It won’t pay out if your illness isn’t serious and it doesn’t cover pre-existing conditions, which means you’d need to apply for coverage before developing a health issue.
The cost of critical illness insurance
Premiums for critical illness policies go up as you age. It’s a good idea to apply for coverage as soon as you identify a need for it.
Here are sample annual rates for a critical illness policy.
Critical illness insurance sample rates (men)
| Coverage amount | Age 20 | Age 30 | Age 40 | Age 50 | Age 60 |
|---|---|---|---|---|---|
| $10,000 | $60 | $87 | $141 | $256 | $516 |
| $15,000 | $77 | $117 | $199 | $372 | $762 |
| $20,000 | $95 | $148 | $257 | $487 | $1,007 |
| Source: LifeStein.com. Data valid as of June 2, 2026, and rates are subject to change. | |||||
Critical illness insurance sample rates (women)
| Coverage amount | Age 20 | Age 30 | Age 40 | Age 50 | Age 60 |
|---|---|---|---|---|---|
| $10,000 | $54 | $78 | $118 | $184 | $333 |
| $15,000 | $68 | $105 | $164 | $263 | $486 |
| $20,000 | $83 | $132 | $210 | $343 | $640 |
| Source: LifeStein.com. Data valid as of June 2, 2026, and rates are subject to change. | |||||
🤓 Nerdy Tip
If you’re looking for a way to replace your income and ease the financial burden on your family when you die, a life insurance policy should be a higher priority than critical illness insurance. Life insurance is more flexible, and the payout applies to a broader range of scenarios. Who should consider critical illness insurance?
Critical illness insurance can be an affordable form of income protection for people who aren’t eligible for disability insurance and might struggle to make ends meet if they get sick.
Consider critical illness coverage in the following scenarios.
🚫 You’re not eligible for disability insurance.
This may include stay-at-home parents, freelancers or those working part-time, as well as people who can’t traditionally access disability insurance.
🧬 You’re healthy but have a family history of medical issues.
Critical illness insurance might also be a good call for those with a family history of certain serious conditions, like heart disease.
For everyone else, the money might be better spent elsewhere — such as boosting a life insurance policy.
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Opting for a critical illness rider
If you’re in the market for term life insurance, some companies include a critical illness rider for free. For permanent policies, critical illness coverage may be included for free or you might have the option to add a life insurance rider for an extra charge. This add-on is likely to be cheaper than buying a separate critical illness policy.
Like standalone policies, a critical illness rider is activated when you’re diagnosed with a qualifying illness, and the money is yours to spend how you wish. The sum of money you’ll receive is spelled out in your policy documents.
The downside? Your insurer will subtract that dollar amount from the final payout to your beneficiaries if you die while your life insurance policy is in force.
Let’s say you have a $500,000 life insurance policy, and a critical illness rider worth $50,000. If you experience a covered illness, you can get a check for $50,000, which leaves $450,000 to your life insurance beneficiaries when you die. If you’re never diagnosed with a serious illness, your loved ones will receive the full life insurance death benefit.
Did you know...
Generally, proceeds from life insurance are not considered taxable income. However, payouts from critical illness benefits can become taxable in certain situations, so it's best to consult a financial expert before you file taxes. Is critical illness insurance worth it?
Keep in mind you can’t add a critical illness rider to an existing policy — only new ones.
As for whether you need one, that comes down to your health insurance or the situation you’d find yourself in if you were slapped with unexpected medical bills.
For example, for people with a very high deductible on their health insurance, adding a critical illness rider to a permanent life insurance policy might make sense. This group may include those who are self-employed, so they have extra protection in the case of a stroke, cancer diagnosis or other critical health condition.
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- 1. American Heart Association. 2025 Heart Disease and Stroke Statistics Update Fact Sheet. Accessed Jun 4, 2026.
- 2. Circulation. Cost of Cardiovascular Disease Event and Cardiovascular Disease Treatment–Related Complication Hospitalizations in the United States. Accessed Jun 4, 2026.
