Critical Illness Insurance

What is a critical illness policy?

Critical illness cover pays a tax-free lump sum if you’re diagnosed with a defined critical illness during the policy term.

Provided you keep paying your premiums, you should be covered throughout the term. Once the policy term ends, all protection stops.

When you take out a policy you can decide how long it will last e.g. until your children have grown up, or until the mortgage is paid off.

Critical illness cover is often available as a combined policy with term life insurance. In these instances, you can often only claim once.

For example, if you get a cash payout after being diagnosed with cancer, the policy is effectively finished. There is usually no life insurance payout if you die at a later date.

Who needs it?

Different people will need critical illness cover for a variety of reasons.

If you’re single, you might want a policy to ensure your mortgage is paid, and some form of cover is often a requirement of the mortgage application.

If you have children, you may want to ensure your family is provided for if you can’t work due to ill health.

Recovering from a critical illness can also mean extra costs for you and your family e.g. making changes to your home or car. Your payout could be used to cover this.

Should I get critical illness insurance?

Most people could benefit from a critical illness policy, but the impact of the premium and the benefit of the payout will vary from person to person.

It’s a matter of weighing up the monthly cost against the benefits of a payout. If you and your family depend heavily on your salary, it could be exactly the kind of protection you need.

If you have no financial commitments or dependents, critical illness insurance may not be for you.

How much cover do I need?

Traditionally, critical illness plans pay out the full amount regardless of how serious your illness actually is.

Some offer severity-based cover, where the payout depends on how bad your illness is.

When deciding on how much cover you need, think about what you would lose if you were unable to work due to illness.

Also, think about what financial commitments you would still have, such as children or a mortgage.

Try using our life insurance calculator, which can help you figure out how much cover you may need.

Which illnesses are covered?

Illnesses covered will vary between insurers, so it’s important to check the details of a policy before you buy.

Policies commonly cover illnesses such as some types of cancer, heart attacks and strokes, and may include optional add-on illnesses.

Other conditions that could be classed as critical illness include:

  • Major organ transplant
  • Parkinson’s disease
  • Deafness
  • Traumatic head injury
  • Bacterial meningitis
  • Blindness
  • Cancer
  • Diagnosis of ALS
  • End Stage Renal Failure
  • Heart Attack
  • Stroke

A critical illness and terminal illness are different things – a standard life insurance policy should cover any illness where you are expected to die within 12 months of diagnosis.

How can I this insurance?

There are two ways you can get this Critical illness insurance.  First, you can get a stand alone policy to cover this.  the premium is vary by the companies.  This type of policy usually have some limitations; such as the length of the policy term and the coverage amount.

Second, you may get this policy bundle with your life insurance products.  Currently some of the life insurance companies offer the rider that the customer can add “Critical Illness ” onto the policy.  So, the premium you are paying to the policy will have not only has the life protection, but also has the Critical Illness protection.   This life policy will not have the limit for the policy term and the coverage amount,  as long as your policy is active and in force, the customer will have the cover.

Our agency offer free consultation with the client and meet their needs.   Contact us today and see which option is good for you.