Do you need critical illness cover?

Do you need critical illness cover?

It can get a bit confusing, all this talk about insurance cover and protection. It’s possible you already have life insurance (more information available here, if you don’t). You may also have income protection. But there’s another type of protection that will pay out a tax-free lump sum as a one off payment to help cover debts like your mortgage, or cover the cost of make changes to your house to accommodate wheelchair access, for example, should you need it.

So, what is critical illness cover?

Critical illness cover specifically covers a set of medical conditions or injuries that are listed in the policy. It doesn’t cover every medical condition, and it can depend on how serious the condition is before it pays out. If/when required, the policy will pay out once and then the policy ends. There are variations on this, however, so it’s a good idea to discuss your requirements with your financial adviser.

Examples of conditions that might be covered include:

  • Heart attack
  • Stroke
  • Certain types and stages of cancer
  • Conditions such as multiple sclerosis

What does critical illness not cover?

A critical illness policy will not cover a condition if it’s not listed in the policy. Also, it’s likely that any pre-existing health problems you have will not be covered either. And one final point is that it’s not life insurance, so it isn’t designed to pay out in the event of your death. It’s important, therefore, to pick your policy carefully and understand exactly what you’re paying for. Your financial adviser will be able to give guidance on this.

So, do you need it?

If you’re concerned that you won’t be able to pay off your mortgage, for example, if you fall prey to a critical illness, then this type of cover is something you should consider. However, you might not need it if you have adequate savings to rely upon to cover your mortgage, your partner can cover your living costs adequately in the event that you fall ill, or your employer offers benefits that do this too.

What affects the cost of critical illness cover?

Factors that affect your monthly premium include:

  • Your age
  • If you’re a smoker
  • Your current health and medical history
  • Your occupation
  • The amount of cover you want

Other types of insurance to consider…

If you’re interested in finding out more about the different types of insurance available to you, click the links below:

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