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Critical Illness Cover

What is Critical Illness Cover? 

No one likes to think about it but what would you do if you became critically unwell and was unable to work due to this? 

Critical illness cover pays a tax-free lump sum if you’re diagnosed with a critical illness during the term of the policy. Once you have decided on the length of the policy: A lot of people choose to have critical illness cover until their children leave home, their mortgage has been paid off or until the big day to retire arrives. 

When you buy critical illness insurance it is like any other kind of insurance: You pay a monthly or yearly fee for it and hope that you never actually need to use it, but you do rest assured knowing that it’s there as a safety net in case life takes a turn into a different direction. 

Critical illness cover ensures that you will receive funds upon the diagnosis of a serious illness – coronary artery bypass, major heart attack, kidney failure, major organ transplant, multiple sclerosis, stroke, and a defined set of specific cancers. The list of illnesses doesn’t end there, as our plans can cover many more, ensuring your and your loved ones are provided for during times of ill health. 

Do I need critical illness cover? 

We can never plan what’s around the corner in terms of our physical health, but you can make sure you have planned and prepared financially. 

Take a moment to consider your current expenses. It might be monthly outgoings like rent payment alongside your general bills, or your loan instalments or repayment on a mortgage. How would you cover these if you became critically unwell and therefore was unable to work? 

If you don’t have a large bank of savings to fall back on, ensuring you have critical illness cover can help remove the financial worry whilst you recover or receive treatment for your illness. One less stress in what could be an incredibly stressful time will make the world of difference. 

How much critical illness cover do I need?

This largely depends on the things you’d like to cover, how much you’re budgeting for your critical illness cover, and for the period of time you’d like this cover. To work out how much critical illness cover you need, it’s advisable to calculate how much money you would need in order to pay for your current outgoings if you were to fall seriously ill and unable to work. 

The policy you decided on is entirely up to you. If you are unsure or would like further advice, get in touch with our helpful and friendly team of financial advisors who will be happy to talk through our options with you. We are a trusted insurance broker who will listen to your needs to ensure we provide you with the type of cover that will provide for you. 

Is critical illness cover worth it? 

The answer to this totally relies on you personally, your lifestyle, and your current finances. Your current employer may not offer a benefits package that pays out if you fall seriously ill during your employment, critical illness cover may be worthwhile to give you peace of mind regarding this. 

It’s worth weighing considering the pros and cons of critical illness cover before you commit to it: 

Pro’s 

Many of us don’t have a surplus of additional funds in a savings pot ready to be used when we need them the most. That’s why the pay-out from critical illness cover can feel like a very reassuring thing to have, providing an income to your and your family. 

Keeping up with Loan and mortgage payments can be difficult in the best of times. The pay-out can help settle any outstanding loans or mortgage payments helping to reduce your stress. 

When we become unwell, it’s not just ourselves that suffers. Those who depend on us are also affected by the change. If you have children or family members who rely on you financially, this can help cover that support. 

Cons 

It’s important before signing on to critical illness cover to find out what is and isn’t covered. Some existing medical conditions may affect this also, have a chat with a financial advisor regarding this for better insight.

Critical illness cover can feel like just another additional bill to pay out for each month or year. Paying for something you never plan to need can feel like a frustrating cost amongst your general bills, but the income protection it would provide in the long term should the situation arise does pay off. 

You may already have an employee benefits package that will pay out compensation if you fall seriously ill during your service 

What types of critical illness cover is available? 

Taking out critical illness cover usually comes in addition to or combined with your life assurance policy. ‘Additional cover’ means you take out life insurance with separate critical illness cover, and you’ll receive a pay-out if you get a critical illness and if you pass away. If you choose to take out a combined policy, you’ll only receive one pay-out, either if you become critically ill or if you pass away during the term of your policy.