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Critical Illness Cover usually pays a one off lump sum, if you are diagnosed with a qualifying critical illness covered during the term of the policy.
The types and range of critical illnesses covered vary from provider to provider, so it is important that clients read the key facts document and that our advisers recommend what policy suits their clients needs. Clients can choose both the term of the policy and the level of cover, although some restrictions may apply. Critical illness protection pays a lump sum on initial diagnosis of a qualifying Critical Illness. Policyholders are permitted to keep the money even if you make a full recovery.
It can be built into another life insurance policy on a level term decreasing term (mortgage life insurance) or whole of life basis, or as a stand alone policy. Once a client has made a critical illness claim it is normal that the policy will cease and other benefits will therefore cease.
Critical illness protection policies vary but nearly always include the following illnesses; - Heart attack
- Cancer
- Stroke
- Kidney failure
- Loss of limbs
It is important to note that not all critical illnesses will be covered under the one policy, so it is important to compare what providers cover specific illnesses. Sometimes, policyholders are not covered for pre existing conditions. Depending upon a client's budget, critical illness policies can be expensive.
Benefits of Critical Illness Cover - Peace of mind - helping to financially secure you and your family's future
- Lump sum payout - The policy usually pays out a lump sum which can be used to pay off a mortgage.
- Options - Alternatively, it is up to the policyholder how you spend the money (e.g. deposit the lump sum in a savings account)
- Family protection - Protect your family in the event of being unable to work
Critical illness protection policies can be split into two types :Death or Earlier Critical Illness pays on either death or critical illness but not both.
Death AND Critical Illness pays on critical illness and death. Once a claim has been made against a critical illness, further critical illness claims cannot be made.
Additional options and areas for consideration include: - Stand alone Critical Illness : with stand alone critical illness quotes in some cases the premiums can be higher than that of a comparable life and critical illness policy quotation.
- Waiver of Premium : if illness prevents you from working your monthly premiums are paid on your behalf for after a set deferment period. Check the quotes Key Facts documents for each quotation produced.
- Survival Period : most policies require you to survive for a specified period following a critical illness diagnosis, typically 14 days to 3 months. Check the quotes Key Facts documents for each quotation produced.
- Permanent Total Disability : if this is not included you will be unable to claim if an illness or accident leaves you unable to work. Also, check the definition of 'permanent total disability'. Some policies define it as being unable to perform any job whilst others define it as being unable to continue in your previous occupation. Check the quotes Key Facts documents for each quotation produced.
- Children : some policies will pay out a fixed lump sum should one of your children be diagnosed with a critical illness. The terms and conditions of policies vary, check the quotes Key Facts documents for each quotation produced.
Insurance which is based on an assessment of the health of the applicant is unlikely to cover the applicant for previous or existing medical conditions and that the customer should refer to policy documentation and seek advice in order to understand what the policy does and does not cover before making an application. For further assistance, call us on 0800 612 7688.
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