What is critical illness insurance?

Critical illness insurance is an additional benefit that provides financial support if an insured person is diagnosed with a serious condition, such as cancer, stroke, or heart attack. It does not replace health insurance. Instead, it complements standard health coverage by addressing the wider financial impact of a major diagnosis. While basic health insurance typically reimburses medical costs, critical illness insurance usually pays a predefined one-time benefit once the diagnosis meets the policy’s criteria.

How does critical illness insurance work?

Critical illness insurance is generally triggered by a confirmed diagnosis of a covered condition listed in the policy terms. Once the diagnosis criteria are met, a predefined one-time payment is made to the insured person. The payment is not tied to specific medical invoices or receipts, and it can typically be used flexibly—such as for treatment costs not fully covered elsewhere, rehabilitation, household expenses, or other financial needs created by the situation.

What does critical illness insurance usually include?

Most critical illness insurance plans include a predefined list of covered conditions and a fixed benefit amount paid after diagnosis of one of those conditions, provided the policy definitions are met. The benefit is usually paid as a one-time payment rather than reimbursement of individual expenses. Coverage details vary by insurer and plan, so the included diagnoses and the exact definitions of qualifying events should be checked in the policy terms.

How is critical illness insurance different from basic health insurance?

Basic health insurance typically covers healthcare services such as specialist consultations, diagnostic tests (including high-tech diagnostics), hospital treatment, and prescribed procedures, usually by reimbursing costs based on submitted invoices. Critical illness insurance works differently: it is triggered by diagnosis rather than expenses and pays a predefined one-time benefit. Its purpose is to support financial stability during a major health event, including needs beyond medical bills.

How is critical illness insurance different from add-ons like dental or outpatient add-ons?

Add-ons such as dental, vaccinations, or prescription medicine coverage are designed for regular, predictable healthcare needs and are often used more frequently. Critical illness insurance is designed for rare but severe events. Instead of expanding access to routine services, it provides financial resilience when a serious diagnosis creates broader disruption—such as additional expenses, recovery needs, or temporary changes in working capacity.

Why do employers include critical illness insurance in benefits packages?

Employers include critical illness insurance to provide structured financial support in the event of a serious diagnosis. A major illness can affect more than treatment costs, including recovery time and household stability. By offering a predefined one-time benefit, employers create a clearer and more predictable support mechanism during high-impact health events. This can improve employees’ sense of security and reduce uncertainty about what support is available when an exceptional situation occurs.

Critical Illness Insurance – Why Is It Worth Attention?

Katelyn McKeone
4 hours ago
2 min read

surgeons performing a surgery which is paid for by critical illness insurance

Most health insurance policies are designed for everyday needs: doctor consultations, diagnostic tests, outpatient treatment. But what happens when something unexpected occurs?

Critical illness insurance helps in situations where an employee is diagnosed with a serious condition — such as cancer, stroke, or heart attack. These illnesses can significantly affect a person’s ability to work, maintain income, and preserve financial stability. Critical illness coverage does not focus on treatment costs — it provides a financial safety cushion that helps adapt to a new reality.

Health Insurance calculator

How does it work?

When an employee is diagnosed with a condition included in the policy terms, they receive a one-time payment — a fixed amount that can be used at their discretion:

for treatment in Latvia or abroad,
for rehabilitation,
for household expenses,
for everyday bills or loan obligations.

How does it differ from basic health insurance?

	Basic Health Insurance	Critical Illness Insurance
Triggered by	Incurrence of expenses	Diagnosis of a covered condition
Type of compensation	Reimbursement based on submitted invoices or receipts	One-time fixed payment
Purpose	To cover medical treatment costs	To provide financial support, regardless of income loss or adjustment needs

Basic insurance helps cover expenses related to doctors and treatment. Critical illness insurance supports life after the diagnosis.

How does it differ from basic health insurance?

Basic health insurance typically covers:

Specialist consultations,
High-tech diagnostics (MRI, CT scans, laboratory tests),
Inpatient treatment,
Prescribed procedures.

These policies reimburse medical expenses. Payments are linked to submitted invoices and specific treatment services.

Critical illness insurance works differently:

It focuses on rare but severe events,
It provides more substantial financial support,
It helps the employee maintain stability and independence.

Even if treatment is fully covered, a serious illness often results in reduced income, lifestyle adjustments, or additional non-medical expenses. Basic coverage typically does not address these consequences.

Why do companies include it?

When something significant happens in an employee’s life, support is expected — but companies do not always have a structured mechanism in place. This type of policy helps to:

structure support instead of reinventing decisions each time;
give employees a sense of care and security;
provide meaningful financial protection, even with a relatively modest investment.

Key benefits at a glance

A one-time payment in the event of a serious diagnosis.
Flexible use — not tied to medical treatment expenses.
Complements rather than replaces basic health insurance.
Helps companies build a clear and balanced support system for crisis situations.

+371 26 668 558

Health insurance Calculator

In person or remote

Konsultācija uzņēmuma vadībai

30min

Reserve now