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Being diagnosed with a serious illness can lead to higher-than-average medical costs and financial stress. That's where critical illness insurance comes in. Aflac offers Critical Illness Insurance plans that are designed to help you financially by paying cash benefits to help you cover costs not covered by primary health insurance.1 However, policyholders may wonder what the tax implications are for these benefits. Read on to learn if the benefits of critical illness insurance are taxable.
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Illnesses covered by critical illness insurance can be categorized as a type of health illness or health event that typically alters how you live. These health events may require surgeries, medications, and therapies that can be costly. Policies differ, but typically, critical illness insurance covers conditions like a heart attack, stroke, or organ failure.
Every critical illness insurance plan works differently, but Aflac offers lump-sum cash benefits for covered events. Affordable monthly premiums are available to help you keep your policy active so you can be better prepared for the medical expenses that can accompany a critical illness. Our critical illness insurance offers benefits for specific life-changing events, like heart attacks and strokes. Often, these circumstances require a recovery period that may be expensive.
The cash benefits offered through Aflac Critical Illness Insurance can help grant you the flexibility to use funds however you need them most. This means you can use the critical illness insurance cash benefits to help with surgery costs, medications or everyday expenses like rent or groceries. Our plans are accessible through your employer and individually. In both cases, we help make the application process easier for you.
Don’t wait until it’s too late. Help cover yourself and your family with coverage from Aflac.
Get StartedIt depends on your unique situation and where you live. In some cases, the payout may be tax-deductible if the premiums for the plan are paid on a pre-tax basis.2
We recommend consulting with a tax professional for the most accurate information regarding tax-deductible benefits for critical illness insurance.
Aflac Critical Illness Insurance might be worth considering if:
Critical illness insurance can provide financial assistance if you face a major health event. If you pay premiums with after-tax dollars, insurance benefits are usually not taxable. To learn more about Aflac’s affordable Critical Illness Insurance plans and get a quote, chat with an agent today.
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1 Investopedia - Critical Illness Insurance/ What Is It? Who Needs It. Updated September 20, 2024. Accessed February 7, 2025. https://www.investopedia.com/articles/personal-finance/010416/critical-illness-insurance-who-needs-it.asp.
2 Brian So Insurance - Is Critical Illness Insurance Taxable? Accessed February 7, 2025. https://briansoinsurance.com/is-critical-illness-insurance-taxable/.
Content within this article is provided for general informational purposes and is not provided as tax, legal, health, or financial advice for any person or for any specific situation. Employers, employees, and other individuals should contact their own advisers about their situations. For complete details, including availability and costs of Aflac insurance, please contact your local Aflac agent.
Aflac coverage is underwritten by American Family Life Assurance Company of Columbus. In New York, Aflac coverage is underwritten by American Family Life Assurance Company of New York.
Critical Illness/Specified Health Event, A74000 series: In Delaware, Policies A74100DE, A74200DE, A74300DE. In Idaho, Policies A74100ID, A74200ID, A74300ID. In Oklahoma, Policies A74100OK, A74200OK, A74300OK. In Virginia, Policies A74100VA, A74200VA, A74300VA. A73000 series: In Delaware, Policies A73100DE & A7310HDE. In Idaho, Policies A73100ID & A7310HID. In Oklahoma, Policies A73100OK & A7310HOK. In Virginia, Policy A73100VA & A7310HVA. B71000 series: In Delaware, Policies B71100, B71200, B7130H & B7140H. In Oklahoma, Policies B71100OK, B71200OK, B7130HOK & B7140HOK.
Tier One Critical Illness coverage is underwritten by Tier One Insurance Company. Tier One Insurance Company is part of the Aflac family of insurers. In California, Tier One Insurance Company does business as Tier One Life Insurance Company (NAIC 92908).
Critical Illness: In Delaware, Policy T71000. In Oklahoma, Policy T71000OK. In Virginia, Policy T71100VA.
Coverage may not be available in all states, including but not limited to DE, ID, NJ, NM, NY, VA or VT. Benefits/premium rates may vary based on state and plan levels. Optional riders may be available at an additional cost. Policies and riders may also contain a waiting period. Refer to the exact policy and rider forms for benefit details, definitions, limitations, and exclusions.
Aflac WWHQ | Tier One | 1932 Wynnton Road | Columbus, GA 31999
Z2400083R1
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