Which of the following best describes a dreaded disease policy?

A dreaded disease policy is specifically designed to provide coverage for serious and often incurable illnesses. These policies typically focus on illnesses that can have significant financial implications for treatment and care. Such diseases may include conditions like cancer, heart disease, multiple sclerosis, and similar health issues that are classified as serious and potentially life-threatening.

In this context, the policy distinguishes itself from other options. It does not cover temporary or mild illnesses, such as a common cold, which are generally not financially burdensome and do not require extensive medical intervention. Similarly, preventable diseases are those that can often be avoided through vaccination or lifestyle changes, which again do not fit the profile of 'dreaded' diseases that this policy aims to cover. By focusing on incurable illnesses, a dreaded disease policy aims to provide financial support to individuals facing serious health challenges that could result in substantial medical costs and impact their quality of life.