A life insurance agent in Manitoba is discussing different types of health insurance. A client, a 55-year-old small business owner, asks about the purpose of a 'Dread Disease' insurance policy. What is the primary focus of this type of policy?

Question: A life insurance agent in Manitoba is discussing different types of health insurance. A client, a 55-year-old small business owner, asks about the purpose of a 'Dread Disease' insurance policy. What is the primary focus of this type of policy?

Answer options: ✅ To provide a lump-sum payment upon diagnosis of a critical illness specified in the policy.

• To cover ongoing medical expenses for any long-term illness or injury.
• To replace lost income if the insured becomes totally disabled from working.
• To reimburse expenses for hospital stays and prescription drugs.

Correct answer: To provide a lump-sum payment upon diagnosis of a critical illness specified in the policy.

Explanation: Dread Disease insurance, also known as critical illness insurance, specifically provides a lump-sum payment if the insured is diagnosed with one of the critical illnesses covered in the policy, such as cancer, heart attack, or stroke.