Regarding Critical Illness insurance in Canada, which of the following statements is most accurate?

Question: Regarding Critical Illness insurance in Canada, which of the following statements is most accurate?

Answer options: ✅ It typically pays a lump-sum cash benefit upon diagnosis of a covered illness, provided the survival period is met.

• It provides monthly income replacement if the insured is unable to work due to a critical illness.
• It covers all medical expenses associated with treating a critical illness, including experimental treatments.
• Benefits are paid out only if the critical illness results in permanent disability.

Correct answer: It typically pays a lump-sum cash benefit upon diagnosis of a covered illness, provided the survival period is met.

Explanation: Critical Illness insurance is designed to pay a tax-free, lump-sum cash benefit upon the diagnosis of a specified critical illness, such as cancer, heart attack, or stroke, provided the policy's survival period (typically 30 days) is met. This benefit can be used for any purpose, unlike disability insurance which replaces income.