Critical Illness Cover
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What is critical illness insurance & Why Should You Consider It?
Critical illness cover is a type of insurance that pays out a tax-free lump sum if you’re diagnosed with a specific medical condition or illness listed in your policy.
It’s designed to help support you and your family financially while you deal with your diagnosis – so you can focus on your recovery without worrying about how you will pay the bills.
How Does Critical Illness Cover Work?
You insure a fixed sum at the outset – usually the outstanding balance on your mortgage etc. – this is paid out on the diagnosis of one of the number conditions listed on your policy. After that, your cover will be based on how long you want your policy to last (as most policies will end automatically once you make a claim) and how much you can pay each month.
It’s a good idea to make sure cover lasts while you still have significant demands on your income, e.g. paying off a mortgage or children’s school fees.
Who Needs Critical Illness Cover?
In reality, everyone needs this cover as critical illness cover is designed to support extra costs if you fall ill; you should consider it if:
You depend on your salary to support yourself and/or your family
You don’t have enough savings to live on if you were to become seriously ill or disabled
Your job won’t cover you for an extended period off work due to sickness (employee benefits package)
Remember too that state benefits come in at around £70-£100 per week, depending on your circumstances, so if you don’t feel this is enough to cover your outgoings, you might want to consider critical illness cover.
How Much Cover Do You Need?
Again, think about the costs you’d need to cover if you were to fall ill and couldn’t work.
- If you have children, you’ll want to ensure that your family is provided for if you can’t work due to health problems. An increasing cover helps protect your cover against the effects of inflation, offering extra financial security for you and your loved ones.
- If you’re single, you’ll need the policy to ensure you can pay off your mortgage. A decreasing cover helps to pay off debt, like a mortgage, that is reducing over time.
For extra protection, you can usually get critical illness cover and life insurance simultaneously. This way, you’ll be protected against different circumstances – with the flexibility to choose how much cover you need for each policy—and claiming one policy shouldn’t affect the other.
It’s important to understand that critical illness policies don’t cover all illnesses; however, this will be disclosed when we select the best plan that meets your needs.
Thankfully all the above questions are what we are here to answer. We arrange cover from a selection of providers and tailor-make the ideal protection plans designed around you and your circumstances.
Did You Know?
The estimated lifetime risk of cancer diagnosis is 1 in 2 (50%) for males and 1 in 2 (45%) for females born after 1960 in the UK. This is in line with previous estimates.
Cancer Research UK, Accessed January 2019
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