Smart financial planning involves preparing yourself for unexpected as well as expected expenses. You can save enough money to cover your expected cost of living during retirement, but you also need to be prepared for unexpected expenses, such as a cancer diagnosis.

Since nearly two in five Canadians will get cancer at some point in their lives, according to a report by the Canadian Cancer Society, it’s worth considering what the disease could mean to your financial as well as your physical health.

So how much does having cancer cost? The short answer is: more than you might think.

The cost of your cancer depends on many variables, such as:

  • the kind of cancer you have
  • how early you’ve been diagnosed
  • the kind of treatment you undergo
  • how much time you need to take off work, and whether anyone needs to take off time to care for you

Another variable is location. If you live far from the nearest cancer-care centre, your out-of-pocket costs – transportation, accommodation, meals – will be higher than if you live nearby. Location also matters when it comes to paying for chemotherapy. Here’s why: In the past, chemotherapy was almost always given intravenously in hospitals, so it was covered by government health plans, just like other hospital-administered medications. But today, many kinds of chemo are taken orally, at home – and not all provincial health plans fully cover them. Currently, only British Columbia, Alberta, Saskatchewan and Manitoba cover home-administered chemo.

There are ways to help cushion the cost. Government assistance may be available if your drug expenses exceed a certain percentage of your income, and there are special arrangements with some drug manufacturers. Applying for these programs can be complex and time-consuming, which is why cancer centres have social workers on staff to help you navigate the system.

Health insurance can also help you cover the cost of cancer treatment. Workplace health benefits like supplemental medical insurance will help you pay for medicines and equipment not covered by your provincial plan, and disability insurance will pay you part of your lost income while you’re off work. Both kinds of insurance come with deductibles and limits, and you’ll need to submit receipts to get your money back.

How will you pay for your cancer treatment?

Item Covered by government insurance Potentially covered by employer/private insurance, subject to deductibles and limits Out of your pocket
Hospital care X    
Physician care X    
Radiation therapy X    
Chemotherapy administered in a hospital X    
Chemotherapy administered at home

Varies by province

   X
Other prescription drugs (e.g., anti-nauseants, pain relievers) taken at home   X X
Reconstructive surgery X    
Rehabilitation   X X
Wigs, prostheses, other equipment and devices   X X
Vitamins and supplements   X X
Lost wages (yours)   X (if you have long-term disability insurance) X (if you don’t have long-term disability insurance)
Lost wages (your partner’s)     X
Gas/transit/parking     X
Meals     X
Hotels     X
Child care     X
Housekeeping     X

Critical illness insurance works a little differently. It can help you cover whatever expenses you incur while you’re fighting and recovering from one of the types of cancer that your policy covers, with no deductibles to pay and no receipts to submit. If you’re diagnosed with one of the serious illnesses covered by your policy, after the required waiting period (typically 30 days following diagnosis), your insurance company will pay you the entire amount of your policy, all at once, to spend on whatever you want.

You could use the money to make up the difference between what your workplace health insurance covers and what you’ve had to spend on medicines. You could use it to cover the hotel bill that your spouse ran up while you were in an out-of-town hospital. You could pay someone to clean your house and look after your children, while you’re not feeling up to it. You could even use some of the money to go away for a weekend to rest and relax, once you’ve recovered your health.

How much does critical illness insurance cost?

The younger and healthier you are when you buy your policy, the less you’ll pay each month. Usually, the longer the policy term (commonly 10 years, to age 75 or to age 100), the higher the cost. Policies that cover more illnesses cost more. And special features, such as getting back some of what you’ve paid if the policy expires or you die without making a claim, also cost more.

You can buy critical illness insurance policies that will pay you from $25,000 to $2.5 million. Here are some sample cost ranges for Sun Critical Illness Insurance from Sun Life Financial, for a $100,000 policy for healthy, non-smoking men and women. The low end of the ranges are shorter terms with fewer features, and the high end, longer terms with more features.

What $100,000 of Sun Critical Illness Insurance could cost per month*
  Age 30 Age 40

Age 50

For a man

 $32.40 - $107.01 $50.94 - $169.20

$109.35 - $370.53

For a woman

 $31.50 - $98.64 $50.67 - $154.42

$94.05 - $310.86

If you buy a 10-year-term critical illness insurance policy and renew it every 10 years, your cost will increase each time you renew. If you buy a non-renewable policy that expires at age 75 or age 100, your cost typically won’t increase as you get older. You can buy most critical illness insurance policies until you’re 65, and make a claim at any age during the policy term.

* These are sample premiums provided by Sun Life Financial as of March 2018 for Sun Critical Illness insurance. Your cost may vary, depending on your health and the options you choose. The rates and values shown above are for illustration purposes only. Unless specifically stated, the values and rates presented are not guaranteed. Talk to your advisor to get a quote. Sun Life Financial also offers Express Critical Illness Insurance, which differs in features and costs.