Wednesday, April 13, 2011 8:19:36 AM

I’ve got a history of cancer in my family--should I buy cancer insurance?

The need for cancer insurance has been hotly debated. Cancer insurance acts as a veil to protect your income and assets from cancer-related expenses that your regular health insurance policy will not cover, such as deductibles, out-of-network specialists, experimental cancer treatment, child care, FDA-approved prescription drugs, travel expenses tied to treatments and even everyday living expenses. Cancer insurance usually is a secondary plan, meaning your major medical policy and disability insurance kick in first. Cancer insurance would come into play to cover what those plans do not.

If your primary health insurance plan is good, you may not need cancer insurance. Ultimately, the decision comes down to curbing your financial risk exposure and maximizing your access to treatment and high-quality care. Grappling with cancer is not only emotionally and physically taxing, it's financially stressful and can wipe out a family's savings. After someone's major medical insurance pays the portion he or she is responsible for, the patient likely will be left with substantial medical expenses and the headache of fighting to get more of those expenses covered.

Not all cancer insurance policies are the same. Use the following tips when you're comparing policies:

1. Consider how much cancer coverage have with your existing health plan. Your current policy may be good enough, or you may want to “upgrade” your health plan for better coverage in the event you develop cancer. If your family health history of cancer is on the lower-risk end, then this option could cost you less and actually cover a wider range of benefits.

2. Are you eligible? Are you a smoker? Have you been diagnosed with cancer in the past? If you answer "yes" to either of these, you may be ineligible.

3. What's the coverage? Some plans (the good ones) will cover out-of-pocket costs associated with hospital stays, radiation treatments, chemotherapy and bone marrow transplants.

4. Will it cover cancer-related illnesses? Most policies don't cover cancer-related illnesses (such as an infection or pneumonia). Those can amount to a large portion of your medical costs.

5. Does the policy have time restrictions? Some policies have a mandatory waiting period and won't kick for one month or several months. Other policies last only for a fixed period two or three years.

6. Are travel expenses covered? Many cancer patients have excessive travel and lodging expenses related to their cancer treatments. Find a policy that takes this into consideration, especially if you're living in an area that doesn't have good cancer treatment options.

7. Are duplicate benefits covered? Make sure your major medical policy allows you to hold other coverage, like cancer insurance. Some major medical policies won't pay claims if you hold two policies.

8. Does the plan offer wellness benefits? Some cancer insurance plans cover just one annual screening, while others cover up to three screenings a year.

9. Is the cancer insurance plan renewable or portable? Some companies can opt to not renew a policyholder. Portability rights ensure that if you leave your current employer, you still can keep your policy.

10. Would a different type of supplemental plan meet your needs? If you have a comprehensive major medical plan, it may be more effective and less costly to simply add a disability policy that would offset any financial hardships.

Remember, the first line of defense is having a solid major medical policy. View cancer insurance as a supplement to your existing coverage, not as a substitute. Finally, ask the right questions when you're searching for a policy.

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Our Insurance Expert

Laura Adams is a personal finance expert and award-winning author who is Senior Insurance Analyst for InsuranceQuotes.com. She represents Bankrate Insurance’s web properties in the media and works as an advocate to make sure consumers protect their financial futures by having the right kinds of insurance.

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