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How to Pay For Critical Illness Insurance in Texas?

You can pay critical illness insurance premiums online through bank transfers, with your credit or debit card, money order, checks, or cash payments at your local insurance agency office. Although regulated by the Texas Department of Insurance, private insurance companies determine the payment plans, mode of payment, and how much prospective policyholders must pay to get this coverage, based on their risk factors.

Who Pays for Critical Illness Insurance in Texas?

Typically, policyholders cover the cost of any critical illness insurance policy they buy. However, some critical illness insurance policies in Texas transfer the payment burden to another individual or entity. For example, some TX employers purchase group critical illness insurance for their employees, while others only cover part of the cost of the policy, and their employees settle the balance. In another instance, employers do not pay any portion of their employees’ group critical illness insurance; the employees, in such cases, are fully responsible for the cost of the policy.

What Are the Payment Options for Critical Illness Insurance?

There are multiple payment options available for critical illness insurance in Texas. Policyholders can pay for their critical insurance policies through the following options:

  • Electronic funds transfer (EFT): This payment method is convenient as it can be done from the comfort of your home or at your local insurance agency if you wish. After your first payment, you can set up automatic withdrawals from your bank account to pay for your insurance premium monthly on a specific date. Under the Electronic Funds Transfer option, you can pay for your insurance through direct deposit, ATM transactions, automated phone payments, electronic checks, or your credit or debit card. However, you may be charged a small convenience fee. If you choose the monthly payment plan instead of annual payment, you may need to set up automatic monthly withdrawals on your card for your convenience and so you never miss a payment. When paying with your credit card, ensure you do not use 75% or more of your credit limit to avoid having a bad credit score.
  • Cash: You can make cash payments at your local insurance agency. Be sure to go along with the exact amount needed to make your payment if your insurance company allows cash payments.
  • Cheque or money order: This option is valid if you are mailing your insurance payment through a mail service. Although it is among the payment options, it is the least convenient option and can take a long time to process. So if your payment is almost due, you risk missing your payment and being subject to a penalty in the form of extra payment. If you must use the mail-in payment option, ensure to use a fast mail delivery service. Also, note that not all insurance providers allow mail-in payments; therefore, confirm from your insurer to know whether they support mail-in payments.
  • Payroll deduction: If your employer pays only a portion of the premium, the balance is deducted from your paycheck.
  • Life insurance premium: If your critical illness coverage is part of the life insurance policy, it’s cost is included in the overall premium (typically paid monthly or annually)

Regardless of your payment option, it is advisable to always promptly pay your premiums to avoid missing a payment and paying interest on the amount you owe.

Can I Finance the Critical Illness Insurance Cost?

Critical illness insurance is usually affordable, costing between $25 to about $400 monthly, depending on the individual and the preferred policy. The policy’s affordability makes it unnecessary to finance the cost. Discuss with your Texas-licensed insurance agent, who can offer different options to finance your critical illness insurance policy. Agents can also help you find amazing discounts from insurers.

Is Premium Financing Available For Critical Illness Insurance?

No. Due to the relatively low costs, premium financing is typically not available for critical illness insurance on its own. If critical illness coverage is purchased as an add-on to a high value life insurance policy, life insurance premium financing may be possible (speak with your life insurance agent for more details).

How Often is Critical Illness Insurance Paid?

In Texas, policyholders determine how often they pay their critical illness insurance premiums. Premiums can be paid monthly, bi-annually, or annually, depending on the agreed terms. However, most insurers prefer to receive premium payments upfront, so they offer discounts to policyholders who make bi-annual or annual premium payments.

Is Critical Illness Insurance Paid Monthly or Yearly?

Critical illness insurance can be paid either monthly or yearly in Texas. However, the annual payment option has some advantages; annual fees cut some of the insurer’s administrative costs. This makes them offer discounts to policyholders who choose this option, affording the policyholders a cheaper option in the long run.

Can Critical Illness Insurance Be Paid Annually?

Yes, critical illness insurance can be paid annually. If you pay your premium annually, you may be eligible for a discount of up to 10% or even more, depending on your insurer.

Can New Critical Illness Insurance Cover Old Bills?

Yes. Policyholders have total freedom to decide how to spend their critical illness insurance payout. Many individuals spend it on old or existing medical and non-medical expenses, including mortgages and other loans.

How Do I Send My Critical Illness Insurance Bill?

You can send your critical illness insurance bill through mail services, online payments, or in person at your local agency. Most people prefer to send their insurance bills through their insurer’s online payment platform because it is the most convenient option. Typically, when your critical illness insurance bill is due, your insurer would notify you if you did not set up automatic insurance bill debits on your credit card. They will also specify the payment options available to you.

Do I Pay My Critical Illness Insurance or My Doctor?

You pay your critical illness insurance premiums to your insurer monthly, biannually, or annually, as agreed in the contract. When you are diagnosed with any of the conditions your policy covers, you will file a claim with your insurer and receive payment directly. You can use the funds received to make payments at the hospital when you receive medical healthcare.

Who Do You Pay a Critical Illness Insurance Copay To?

You do not have to make copays when you purchase critical illness insurance. Critical illness insurance does not have copays.

Who Do You Pay Critical Illness Insurance Deductible To?

Critical illness insurance does not require you to pay any deductible. Critical illness insurance does not have copays.

Who Do You Pay Critical Illness Insurance Coinsurance To?

You do not pay coinsurance when you have a critical illness insurance policy.

Do I Pay Taxes on Critical Illness Insurance?

You do not pay taxes on critical illness insurance benefits. The benefits received are tax-free, and policyholders have total freedom on how and when to spend the funds. Critical insurance

Can You Pay Critical Illness Insurance Late?

You can only make payments for critical illness insurance on the dates specified in your contract. Make sure to inform your insurer if you will be paying late.

Does Critical Illness Insurance Have a Grace Period in Texas?

Yes, critical illness insurance in Texas has a grace period for insurance payments, which is 30 days after an insured misses the scheduled deadline for premium payment.

What is a Grace Period in Critical Illness Insurance?

In critical illness insurance, a grace period is an additional period insurers give policyholders to make payments after missing a deadline. In Texas, the grace period is 31 days after the initial payment due date.

Is There a Grace Period for Critical Illness Insurance After Termination?

No. If your critical illness plan is terminated because you failed to meet up with your scheduled payment and the grace period expires, your policy will expire, and you do not receive any grace period after termination. Your critical illness insurance lapses after termination.

What To Do If You Can’t Pay For Critical Illness Insurance in Texas

If your income cannot cover critical illness insurance, you do not need to buy the policy. The policy is not mandatory. It only supplements your existing health insurance plan in Texas. Instead of a critical illness insurance plan, you can get affordable ACA health insurance.

Will My Critical Illness Insurance Lapse If I Miss a Payment?

Your critical illness insurance plan does not immediately lapse if you miss a payment in Texas. Many insurers offer policyholders a grace period after the payment due date. Insurers still pay policyholders if they are diagnosed with any covered medical conditions in their policies before the grace period expires. However, insurers deduct any outstanding premium payment before paying the balance to policyholders in the event of payouts. If you do not make payments before the expiration of the grace period, your insurance policy will be canceled.

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