Which type of insurance provides payment upon the diagnosis of a critical health issue?

Critical illness insurance specifically offers financial protection by providing a lump-sum payment upon the diagnosis of a specified critical health issue, such as a heart attack, stroke, or cancer. This type of insurance is designed to alleviate the financial burden that can accompany serious health conditions, allowing beneficiaries to cover medical expenses, maintain their lifestyle, or pay for treatments that may not be fully covered by other insurance policies.

In contrast, life insurance pays out upon the death of the insured, providing benefits to the beneficiaries rather than directly addressing health issues faced by the insured. Homeowners insurance covers property and liability related to a home, which does not pertain to health conditions. Auto insurance covers vehicles and injuries related to automobile incidents, which is unrelated to critical health issues. Therefore, the focus of critical illness insurance on specific health diagnoses makes it the correct choice for the question posed.