Critical illness cover or critical illness insurance as it is also known is a long term insurance policy that undertakes to pay a one-time lump sum in the event that you are diagnosed with a serious illness or incapacitated (perhaps even temporarily) by a serious illness or injury.
This payment is a one-off lump sum and might go towards improvements to your home (in the case of immobility following an illness or accident) or to cover other living costs. It is not an ongoing payment.
Critical illness insurance usually pays out in the event that you suffer from one of a variety of serious conditions including heart attack, stroke, certain types and stages of cancer, multiple sclerosis, etc or injury. Some illnesses are unlikely to be covered, including certain types of cancer and illnesses you knew you already suffered from at the beginning of the policy. Each policy will detail what is and what is not covered.
The cost of taking out critical illness is, unsurprisingly, linked to the risk the insurer perceives that you present. A clean living, non-smoking, 23 year old, married woman with no history of illness and a habit of regularly visiting the gym and regularly participating in games of badminton is going to pay far less in premium than an overweight, sedentary, 50 year old man with a family history of heart disease, a 20-a-day smoking habit and a liking for beer festivals and skydiving at weekends!
Of course, that clean living, 23 year old might well be thinking ‘so why do I need to insure against the unlikely’?
The fact is that every year 1 million workers in the UK unexpectedly find themselves unable to work because of injury or illness (Source: Association of British Insurers). Losing the ability to work, even for a short time, can have a dramatic effect on one’s life, let alone the onset of a chronic, lifetime illness. Bills still need to be paid and unless you have substantial savings or a partner that can keep the wolf from the door whilst you are recovering, you should seriously consider critical illness cover as part of your risk management plan.
Other insurances worth considering, dependent on your circumstances, might include life insurance (particularly when you have dependents), income or payment protection insurance policies or a short term income protection policy and also Accident Sickness & Unemployment (ASU) cover.
For more information see our protection page or speak to an adviser on 01628 507477.
Related articles:
Download our Free First Time Buyers Guide
Recent posts
Data shows landlords could miss out on green mortgages due to expired energy performance certificates.
Buying a house is a big deal, and where you are planning to buy will make a difference financially. In this short blog, we look at the most affordable and most expensive areas and how much you need to be earning to buy in there.
Pros and Cons of Equity Release
10 days ago
Equity release is a type of mortgage that allows homeowners 55 and over to access money from their property's equity without having to leave their home. This is done by securing a loan against the house which is usually repaid by selling the property when the borrower passes away or has to move into long-term care.
Your House Viewing Checklist
11 days ago
It’s important to ask questions about the property you are interested in before taking that step to make an offer. A little probing can make all the difference between buying your dream house or something that requires a lot of work.
Half of over 60s predicted to benefit from accessing housing wealth through Equity Release
14 days ago
There are millions of homeowners over the age of 60 who are likely to release money from their homes to pay for their lifestyle during retirement giving those who are 'asset rich but cash poor' a way to live out their retirement the way they wish.
Average Age of the First Time Buyer in the UK
21 days ago
The average age of a first-time buyer in the UK is two years older than 10 years ago. This is understandable with managing the cost-of-living and challenges within the economy such as high interest rates making it difficult to get onto the property ladder.
Delayed Start Mortgage from Skipton
23 days ago
Skipton Building Society launches ‘Delayed Start’ mortgage meaning first time buyers won’t be required to make repayments for the first three months.
According to a survey by Skipton, first time buyers who bought their home in the last five years found that in the first three months of living there, they were spending upwards of £30,000.
Gardening Tips for Beginners
28 days ago
If you have recently moved into a property with a garden that requires a little TLC, or you’d like to get on top of your current green space, check out our tips.
More information
Trusted by
