Skip to Content
Multigenerational family talking on couch representing that different stages require different insurance policy types.
Policy Types

Critical illness and disability insurance differences

In the event of a serious accident or illness, are you prepared to protect your assets and income? Critical illness and disability insurance offer protection but in different ways. Find out the differences.

Nobody likes to think about death, a serious accident or illness. Unfortunately, these events can be a part of life and many Americans aren't considering the fact that they may experience an accident or illness in their lifetime that could cause extreme financial stress.Fortunately, to protect your assets and income, there is critical illness and disability insurance. But what's the difference?

The difference between critical illness and disability insurance

In addition to health and life insurance, you may also be offered voluntary benefits through work that may include some type of critical illness and/or disability coverage. However, while both types of policies provide a level of financial protection, they are not the same.

  • With critical illness insurance, you may receive a lump sum of money or a series of payments if you are diagnosed with any one of the covered illnesses indicated in your policy. Disability insurance, however, pays you when you're injured or sick and unable to work* for a period of time.
  • Critical illness insurance can help provide a source of cash to help pay for medical costs, while disability insurance pays a portion of your income while you are unable to work.*
  • When diagnosed with a covered illness on a critical illness policy, you typically won't be required to provide proof that you are unable to work once the lump payout has been made. With disability, the insurance company may require ongoing proof that you are unable to return to work and your payments will end once you are no longer disabled as defined by your policy.
  • The amount of the payout on your critical illness insurance policy is specified in the terms of your contract, while disability benefits are based on a percentage of what you earned before you became disabled.

It's important that you learn as much as you can about the benefits offered through your place of employment in order to make informed decisions. When it comes to critical illness, review the list of covered illnesses to evaluate whether or not that particular policy is right for you. For example, you might not want a policy that excludes cancer if you have a family history of this type of illness. For disability, check to see if you have a short- or long-term policy and if you have options for purchasing more coverage.

Learn more about how a disability or serious illness may affect your finances.


*You must meet the conditions for total disability as defined in your contract and may be subject to a waiting period before benefits begin.



Arrows linking indicating relationship

Related Articles

A mother wearing a baby holder while browsing her phone for life insurance policies.

Should a stay-at-home parent have a life insurance policy

Learn more
Man in a green sweater in a cafe,looking at his iPad, as if researching life insurance options.

Compare and contrast: Indexed universal life vs. whole life insurance

Learn more
 Grandfather and grandson playing in the den, grandfather is healthy enough to qualify for senior life insurance

Senior life insurance

Learn more

All Learning Center articles are general summaries that can be used when considering your financial future at various life stages. The information presented is for educational purposes and is meant to supplement other information specific to your situation. It is not intended as investment advice and does not necessarily represent the opinion of Protective Life or its subsidiaries.

Learning Center articles may describe services and financial products not offered by Protective Life or its subsidiaries. Descriptions of financial products contained in Learning Center articles are not intended to represent those offered by Protective Life or its subsidiaries.

Neither Protective Life nor its representatives offer legal or tax advice. We encourage you to consult with your financial adviser and legal or tax adviser regarding your individual situations before making investment, social security, retirement planning, and tax-related decisions. For information about Protective Life and its products and services, visit

Companies and organizations linked from Learning Center articles have no affiliation with Protective Life or its subsidiaries.