Critical illness cover and how to use it

There are a variety of different types of insurance cover available in the UK these days, many of which are designed to offer protection under certain circumstances.

One type of insurance cover that many people decide to opt for is known as critical illness cover, and this is a type of cover that is designed to offer financial protection in the even that you are diagnosed with a critical illness, which could in effect mean that you are unable to earn an income.

Critical illness cover has been around for some time, and is available from a wide range of insurance providers. This type of cover can be taken as a stand alone policy or with another type of cover, such as life insurance cover, as an add on.

The cost of this type of cover can vary, but it does depend on a number of factors, such as the level of cover that you take and the provider that you go through. When you have critical illness insurance cover you can enjoy increased peace of mind, but it is important that you select the right policy in order to ensure that you have adequate cover as well as to ensure that you do not pay over the odds on your cover.

Below are some frequently asked questions relating to critical illness insurance cover:

What is critical illness cover?

Critical illness insurance cover is a type of cover that is designed to payout in the event that you are diagnosed with a critical illness.

This type of cover is available from a number of providers, and there are – as with all insurance policies – certain restrictions in place. Basically, critical illness cover is designed to pay out a lump sum in the event that you are diagnosed with a critical illness subject to meeting the terms and conditions of the policy.

You should be aware that the list of critical illnesses that are covered can vary based on provider, and you should therefore check the policy and what is covered before you sign up to the policy and before you make a claim.

What sorts of illnesses are generally considered critical?

The illnesses that come under the umbrella of critical illness can vary from provider to provider, so it is important to check any policy terms and conditions before you make a commitment.

There are over thirty conditions covered by many insurance companies these days, which can vary – not all insurers will cover all conditions. However, there are some core conditions that should be covered by all critical illness insurance providers, and this includes: major organ transplant, stroke, cancer, kidney failure, heart attacks, multiple sclerosis, and coronary artery bypass.

Will I get the payout right away if I am diagnosed with a critical illness?

In most cases the insurance company will only pay out after you have survived for twenty eight days following the diagnosis of your critical illness. Therefore, if you die from the illness within that twenty eight day period no payout is made and the policy becomes null and void.

What if I go on to recover from the illness?

If you receive a payout on your critical illness but you then go on to make a full recovery you will still get to keep the money from the payout. However, your policy does then become null and void.

What are the main benefits of critical illness cover?

If you are diagnosed with a critical illness the strain, both emotionally and financially, on you and your loved ones can be immense.

Receiving a lump sum payout means that you can offer financial protection for your family at a very difficult time, helping to secure their financial future, and you can ensure that even if you are unable to earn money you still have cash that you can use to fund day to day living for your and your family or even to pay off debts or your mortgage to ensure that your family does not have to worry about finances on top of everything else.

What are the restrictions relating to critical illness cover?

There are be many different restrictions relating to this type of insurance cover, and many of these restrictions have come under fire from regulators and campaigners for making it too difficult for policyholders to make a claim.

It is vital that before you make any commitment with a critical illness insurance policy you check through the restrictions carefully, as otherwise you could find that you end up with a policy on which you can never make a claim.

How much will I receive by way of a payout?

The amount that you receive will depend on the level of cover that you take out. You should make sure that you take out an adequate level of cover to provide you with the finances that you would need if you were to be diagnosed with a critical illness. However, the higher the level of cover the more expensive your premiums will be.