Cancer Insurance: Compare Companies, Coverage, and Costs

According to the American Cancer Society, more than 1.7 million new cancer diagnoses are expected in 2019. The chances of developing cancer are fairly significant for both men and women, with around 39 out of 100 men and 38 out of 100 women developing cancer at some point during their lifetime.

The good news is there has been progress in early detection and advances in cancer treatments, which means cancer deaths are occurring less often than in the past. The bad news? Cancer treatment can be extremely expensive, especially if you’re managing cancer as a chronic condition.

Total direct medical costs of cancer were estimated at $80.2 billion in 2015, and sadly, the American Cancer Society has identified a lack of health insurance as a barrier to optimal cancer treatment. Thanks to ever-increasing deductibles, many people with health insurance coverage may struggle to afford the co-insurance, copays, and other out-of-pocket expenses necessary for effective cancer treatment.

If you’re concerned about how you’d cover the costs of cancer care for you or a loved one, you may want to consider the purchase of cancer insurance.

In this guide:

• What is Cancer Insurance?
• What Are Some Cancer Insurance Companies?
• How Does Cancer Policy Coverage Work?
• How to Get a Cancer Insurance Policy
• What Factors into the Cost of a Policy?
• How Does a Cancer Policy Defray the Cost of Treatment?
• Important Limitations to Consider

What is Cancer Insurance?

Cancer insurance is supplemental insurance that provides coverage only in the event you develop cancer. There are three primary types of cancer insurance:

• Expense-incurred policies: This type of policy pays out a percentage of expenses incurred, up to policy limits. The policy may pay a portion of copays, coinsurance, and drugs or treatments your traditional health insurance doesn’t cover.
• Indemnity policies: These policies cover expenses for approved treatments, up to a set limit. The maximum payout may be lower than the actual costs of care.
• Lump sum policies: Lump sum policies pay a fixed amount of money after a cancer diagnosis. You can use the payout for any costs you want.

You can buy cancer insurance from a variety of different insurance companies offering these add-on policies; however, cancer insurance will not replace your standard health insurance coverage. You’ll still need a regular health insurance policy to make sure you have coverage for preventative care and any other illnesses that you may develop.

What Are Some Cancer Insurance Companies?

Many different companies offer cancer insurance. Some companies that provide this type of policy include:

Cigna

Cigna provides lump sum cancer insurance.

• A lump sum benefit means you receive a check to cover any expenses you need after a cancer diagnosis.
• Monthly premiums usually cost around $19.
• Higher coverage amounts lead to higher premiums.
• Policies are available for people ages 18 to 99 and include coverage for both you and dependents.
• You can get a quote online or via phone at 855-358-8530.

Aflac

Aflac provides cancer indemnity insurance.

• Cancer indemnity insurance provides a set payout for specific types of cancer care you receive, such as injected chemotherapy or radiation. Coverage is determined based on your policy and type of treatment.
• Weekly premiums are as low as the cost of a gallon of milk.
• You must be at least 18 years old to apply for Aflac cancer insurance.
• One Day Pay is available for certain claims submitted online, so you can obtain access to funds quickly when you become eligible for benefits.
• You can get a quote online or via phone at 855-684-2339.

Physicians Mutual

Physicians Mutual provides cancer coverage that pays benefits as you incur expenses.

• You’ll receive a set benefit for expenses such as hospital rooms, air or ground ambulance, doctor visits, inpatient prescription drugs, or surgery.
• Coverage is guaranteed renewable and payments can be made either to you or your provider depending on your preference.
• You’ll have a choice of individual or family benefits when signing up for coverage.
• You can get a quote online or via phone at 888-932-7642.

Mutual of Omaha

Mutual of Omaha cancer insurance provides benefits to help cover the costs of treatment.

• Benefits can be paid directly to you or to a provider when you incur costs for radiation therapy, chemotherapy, inpatient hospital care, surgery, hospice care, ambulance transport, medications administered in the hospital, follow-up medical visits, and preventative screenings.
• Coverage between $10,000 – $100,000
• Policies are available to applicants between the ages of 18 and 91.
• You’re eligible for coverage if you haven’t had cancer in the past five years (three years in case of skin cancer).
• You can get a quote online or via phone at 800-621-3917.

Family Heritage

Family Heritage provides supplemental coverage to help pay for expenses incurred in treating cancer.

• You’ll receive help paying for certain treatment-related expenses such as hospitalization, ambulance transport, radiation and chemotherapy, surgery (including breast reconstruction surgery), hospital care, transportation, and family member lodging.
• Claims can be filed online as long as your policy is at least two years old. Claims made within the first two years of coverage are subject to additional review.
• Costs and benefits vary by state.
• You can apply by using the Family Heritage website to find a local agent in your area. You can also call customer care at 440-922-5222.

Allstate

Allstate provides cash benefits directly to the insured after a covered cancer diagnosis.

• Cash benefits can be used for any purpose, including helping pay for travel expenses, covering the mortgage while you can’t work, paying for upgrades or repairs to adapt your home, or covering medical expenses incurred during treatment.
• Choose between individual and family coverage.
• You can call 800-521-3535 to find out about applying for coverage.

How Does Cancer Policy Coverage Work?

As you can see, different insurers offer different kinds of policies that provide different types of protection.

If you get a lump sum payout policy, you’ll receive your funds upon your diagnosis with no questions asked and can spend the money on anything you want. This includes out-of-pocket travel expenses to get to treatments, experimental care that may not be covered under a standard health insurance policy, or anything else you might need.

If your policy reimburses expenses, on the other hand, you may be paid benefits each time you undergo treatment, receive care, or travel to the medical facility providing care. You’ll need to read your policy language carefully to understand when and how your benefits are paid.

You also need to read your policy language to find out what types of cancer are covered and if there are any exclusions to coverage. For example, some policies exclude skin cancers.

Cancer insurance typically won’t cover cancer-related illnesses, such as pneumonia that develops in lung cancer patients. Some expense-incurred plans may also restrict coverage to inpatient care only and will not provide payments for outpatient care.

There may be a waiting period after you purchase coverage before you become eligible for payouts, or you might have to make your claim within a certain timeframe after diagnosis or lose eligibility for coverage.

How to Get a Cancer Insurance Policy

Not all insurance companies offer cancer insurance policies, so you’ll need to apply with one that does. This typically means purchasing a standalone policy.

Most insurers that offer cancer insurance policies allow you to get a quote and apply for coverage online. You’ll need to provide information such as:

• Your name
• Your age
• Your health history
• The type of policy you want (lump sum, indemnity, or expense-incurred)
• The amount of coverage you’re interested in

Unlike when you purchase certain types of life insurance or health insurance, you usually won’t have to undergo a medical exam in order to obtain a cancer insurance policy.

Unfortunately, if you currently have cancer or have had a cancer diagnosis in the recent past, you may not be able to buy cancer insurance coverage. This type of policy must be purchased before you get sick.

What Factors into the Cost of a Policy?

Cancer insurers price policies based on the risk they’ll have to pay out. While the underwriting process isn’t as intensive as it is for life insurance, insurers still ask questions to assess your risk and price your insurance coverage accordingly. Some of the factors that impact premium costs include:

• Age: The older you are, the more likely it is you’ll develop cancer — and the pricier your cancer insurance premiums will be.
• Health status: You’ll be asked if you’ve been diagnosed or treated for cancer in the past five to 10 years, or if you’ve been diagnosed with a pre-leukemic condition or another condition with the potential for malignancy in the past five to 10 years.
• Types of coverage: The more comprehensive your coverage, the more costly your plan. Higher coverage limits have higher premium costs. Lump sum plans typically cost more than indemnity plans or expense-incurred plans.

If the risk is too great because you’ve been diagnosed with a pre-cancerous condition or treated for cancer, you’ll be denied coverage altogether. But if you have an elevated risk due to factors such as advanced age, you may be eligible for a policy — but usually with high premiums.

How Does a Cancer Policy Defray the Cost of Treatment?

Cancer is a very expensive condition to treat. Costs can depend upon the type of cancer you develop, the stage at which you’re diagnosed, and the type of treatment required, which may include radiation, chemotherapy, and surgery. For example:

• Among breast cancer patients, average costs per patient in the first 12 months after diagnosis were $60,637 for patients diagnosed in stage 0, $82,121 for patients diagnosed in stage I or II, $129,387 for patients diagnosed in Stage 3, and $134,682 for patients diagnosed in stage 4. Patients continued to incur ongoing costs in subsequent months as well.
• Among colon cancer patients, average treatment costs in the U.S. run an estimated $12,345 monthly.
• Among lung cancer patients, patients who receive only initial treatment incurred estimated costs of $45,953, while patients who needed additional rounds of treatment had average expenditures of $120,650.
• Among liver cancer patients, costs vary depending upon necessary treatment. A liver transplant could cost up to $575,000 or more, while stereotactic radiosurgery often used to treat liver cancer runs between $12,000 and $55,000.
• Among skin cancer patients, average treatment costs are just $1,732 in stage I but rise to $56,059 for stage IV disease.

Although health insurance covers some costs of cancer, patients still must pay out-of-pocket expenses for coinsurance, deductibles, copays, experimental medications and treatments, treatments that aren’t covered, and travel expenses. In fact, patients paid an estimated 4% of cancer costs out-of-pocket in 2014, for a total estimated cost of $3.9 billion.

A cancer policy can help defray the cost of treatment by providing you with either a lump sum payment or helping to cover the costs of individual expenses. While your specific coverage will depend upon policy limits, you’ll often receive many thousands of dollars in benefits from a cancer insurance policy.

Since many cancer insurance plans can be had for just $10 to $50 monthly, the premiums you pay are often worthwhile given the big payouts you could expect to receive if you’re diagnosed with cancer.

Additional Benefits to Consider

The big benefit of cancer insurance is peace of mind. If you’re concerned you could someday incur significant expenses associated with cancer, having this type of coverage could help put you at ease because you won’t have to worry about how you’d pay for care — you can simply concentrate on your course of treatment and getting well.

Some cancer insurance policies also provide a wellness benefit, which is aimed at helping you get the care you need to avoid cancer or spot cancer earlier. Aflac, for example, offers up to $75 annually in cancer wellness benefits per covered person.

If you do get sick, cancer insurance may enable you to get care you might not otherwise be able to afford. If you need to travel for specialized treatment, for example, your cancer insurance could potentially help cover travel costs that regular health insurance wouldn’t.

Important Limitations to Consider

Because cancer insurance only covers cancer, you won’t be provided with any assistance if you develop other conditions. As a result, you may wish to consider a critical illness policy as an alternative to cancer coverage. A critical illness policy works in a similar way to cancer insurance in that it defrays out-of-pocket costs if you get sick, but it can also provide coverage in case of other illnesses such as a heart attack or stroke.

Cancer insurance also won’t help you if you develop a type of cancer that isn’t covered or if your policy excludes the kind of coverage you need. If your insurer has a poor reputation for paying claims, you may also have to fight for every dollar — so be sure to check Better Business Bureau ratings for any insurance company from which you’re considering buying a policy.

And, if you don’t develop cancer, of course, your premiums will have been wasted. Instead of buying cancer coverage, you may decide it makes more sense to pay higher premiums for a more comprehensive health insurance plan that provides broader coverage. You might also consider investing in an emergency fund that could help you cover out-of-pocket costs for any illness you might develop.

Is Cancer Insurance Worth It?

Cancer insurance may be worth buying if you have an elevated risk of developing cancer, such as a history of cancer in your family. If your health insurance coverage isn’t very comprehensive, then it may be worth the cost to buy cancer insurance.

However, you need to make sure you understand coverage limitations carefully, as it makes little sense to buy a cancer insurance policy that won’t actually provide much help in the event you get sick.