The growth of the critical illness insurance market in the US is anticipated.

The market for cancer and critical illness insurance coverage in the United States is expected to grow significantly over the next decade.

These policies pay a lump sum cash benefit upon diagnosis of a covered condition. Critical illness sales rose 14 percent last year, with the vast majority of purchases made as part of employer-provided benefits.

There are several important factors that feed into the prediction of future growth. The first is to raise awareness of the risk of diseases such as cancer and cardiovascular disease: heart attacks, strokes, and the like. In 2020, an estimated 1.8 million American adults will be diagnosed with cancer according to the American Cancer Society. Nearly 800,000 will have a heart attack. In both cases, the numbers are rising and, while not good news, survival rates are rising, along with the associated costs.

The second is the aging of two key demographic cohorts. There are 65.2 million GenXers, those born between 1965 and 1980. Another 72 million comprised the Millennial generation who just overtook Baby Boomers as the largest population segment. GenXers are projected to overtake Boomers around 2028.

For these two cohorts, traditional employment and employer-provided health benefits will be much less common than for previous generations. According to projections by the Bureau of Labor, the percentage of Americans who define themselves as informal economy workers will rise to 43 percent this year. Among those lucky enough to have employer-provided coverage, more are choosing high-deductible plans that leave them exposed to financial risk after a hospitalization or critical illness diagnosis. The way the 137 million people of working age manage health insurance coverage will take on a new dimension.

Finally, some of the nation’s leading insurance companies recognize these changes and now offer critical illness insurance through employer plans or on an individual basis. According to the American Association of Critical Illness Insurance (AACII), major players include Aflac, MetLife, Unum, Mutual of Omaha with new entrants like Aetna. It stands to reason that Theme will recognize the opportunity and increase its marketing and sales efforts.

Currently, about five million people have comprehensive critical illness or cancer insurance coverage, according to AACII. The average amount of new benefits purchased ranges from $15,000 to $22,000 depending on the type of coverage selected. The typical new buyer is in their 40s and 50s, reflecting a population that, once educated about their risk and planning options, will increasingly adopt this coverage.