Why you need Severe Illness Cover Insurance

“Mortality defines the human condition,” the American historian Drew Gilpin Faust once said. While the event of a life-changing illness is not something we like to dwell on, it unfortunately affects a high number of people during their lifetime. This is why Severe Illness Cover is important. 

One only has to look at the stats – cancer affects one in four South Africans, through diagnosis of family, friends, colleagues or self (according to CANSA), with cancer cases and deaths expected to double in Africa during the next two decades, according to researchers. Cardiovascular diseases (CVDs), commonly referred to as heart disease or stroke, are South Africa’s biggest killers, after HIV/AIDs – and it is worth noting that heart attacks are increasingly affecting younger men, more prevalent now in under-40s (source: Heart & Stroke Foundation SA). Furthermore, there is the threat of Covid-19, which has accounted for a total of 217,891 hospitalizations in South Africa over the past few years (NICD data from 5 March 2020 to 27 February 2021).

Consider too the latest claims reports from local insurance companies; Liberty revealed that Covid-19 related illness (21.2%) overtook Cancer (20.7%) as the leading cause of Personal Risk Cover Claims in 2021. Sanlam Individual Life shows similarities in its data – pointing to ‘diseases of the respiratory system’ (in other words, Covid-19 related illnesses), cardiovascular diseases and cancer as the top three causes of death in 2021.

How is ‘Severe Illness’ defined?

A ‘severe illness’ is defined as an acute or chronic illness and/or health condition that carries a high risk of mortality, negatively impacts quality of life and daily function, and/or is burdensome in symptoms, treatments, or caregiver stress. Case in point is cancer, stroke or a heart attack; these health emergencies can change people’s lives dramatically for the worse, and they typically incur greater-than-average medical costs.

Some illnesses, like cardiovascular diseases, can be aggravated by poor lifestyle choices or premature aging – meaning that you can reduce their likelihood through working out regularly, eating healthily, watching your weight, getting enough sleep, and avoiding tobacco, alcohol, refined sugars, and trans fats, for example – whereas other illnesses are simply hereditary, meaning that it runs in your family.

If you were to become severely ill, not only would you be unable to work, affecting your ability to bring in an income, but it’s likely you would also become a burden to your family or partner, due to the need for constant care, on-going medical bills, or cost of equipment requirements (such as a wheelchair). Factor in the fact that treatment and medical procedures for severe conditions, like cancer, can cost up to thousands of Rands. Taking into account that South Africa’s public healthcare system is overburdened, it’s easy to realise that, without the right cover in place, severe illness could be financially devastating.

But what if I already have health insurance or medical aid?

Your existing medical aid or health insurance is highly unlikely to be able to cover all the costs associated with a severe illness. Although a common misconception, it is important to understand that this is not the case. As mentioned, the financial implications that a serious illness brings, such as treatment and medical procedures, can be very costly, especially when it comes to chronic conditions. While the medical aid may pay for some in-hospital expenses and consultations with medical professionals, there are a significant amount of additional medical expenses that will probably put you out of pocket; especially when it comes to the latest treatments available.

Also bear in mind there would be other non-medical expenses, like long-term home nursing and time off work. Needless to say, these costs can rack up fast. Not to mention that if you are ever diagnosed with a serious illness, getting cover after the fact is difficult and expensive – but by getting it ahead of time means lower premiums and a higher pay out.

This is where Severe Illness Cover comes in…

Also referred to as ‘Critical Illness Cover’, ‘Dread Disease Cover’, or ‘Trauma Cover’ (different insurance companies may use different terms), Severe Illness Cover is lump sum insurance cover that pays out on the diagnosis of a serious illness. The specifics of it can change from insurer to insurer, so you’ll need to read the small print to understand exactly which illnesses are covered by the policy and how severe they need to be for a pay out. As explained in a previous blog post, there are two different categories to consider:

  • Severity-based cover:
    The policy pays benefits based on the level of severity of your medical condition or event. For example, the size of the benefit will differ where you suffer a minor stroke as opposed to a major stroke. Severity-based cover tends to be cheaper.
  • Diagnosis-based cover:
    The Diagnosis-based cover will pay the full benefit, provided that certain medical criteria are met. This type of insurance, therefore, tends to be more expensive.

Is Covid-19 covered?

Yes and no. Since Covid-19 was not a major consideration previously, and since it is determined as an infectious disease that does not fall within the definition of a dread disease (in the same way that Ebola and other infectious diseases are not covered), no existing severe illness cover will include it per se.

However, some of the complications of Covid-19 could lead to a claim, for example end-stage lung disease or renal failure. In these instances a claim may be valid, depending on the nature of the selected benefits and specific policy contract conditions. In addition, complications from contracting the virus sometimes result in temporary or permanent disability, and the nature of this could be assessed against any existing disability cover you might have. It’s always important to read the fine print of any cover, or seek help from a professional for peace of mind.


To recap, Severe Illness Cover is a type of personal insurance that assists with the high cost implications of a life-altering severe illness such as cancer, heart disease, stroke, or even ‘diseases of the respiratory system’ (COVID-19 related). The lump sum can be used to pay for expensive medications, surgery, home nursing, or other costs incurred due to the illness. The two categories to consider are ‘severity-based cover’ and ‘diagnosis-based cover’. 

If you’re looking for peace of mind for yourself in this area and are considering Severe Illness Cover, do get in touch with TVC Wealth and Health Managers today to set up an appointment to activate an insurance plan that is personalised to you.

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