Critical Illness Cover is also known as serious illness cover or dread disease cover. This type of insurance provides a lump sum on diagnosis of one of a range of conditions defined within the policy document.
About 80% of all claims are for Cancer, Heart Attacks and Stroke. These are core conditions which are covered under most policies. In addition to these core conditions, most of the better plans offered by reputable international insurers have 30 or more other conditions covered.
Over the last 40 years, your prognosis on learning that you have had a heart attack, a stroke or being diagnosed with a serious illness like cancer has improved dramatically. This means that you are less likely to die from a serious medical condition. Whilst this is good news, the impact of these conditions on your health can be severe. This, in turn, will impact on your ability to maintain the lifestyle of you and your family. Long periods of recovery for the main earner can impact the family finances as seriously as their death.
Life insurance companies do not dictate what money from a critical illness plan must be spent on. Typically, Critical Illness Cover is bought to repay a mortgage or other loan secured on the family home. The mortgage is usually one of the largest bills. Repayment reduces the family expenses and enables other finances available to last longer. Other uses could be to pay for the costs of adapting your home or advanced funding of university fees.
As you are more likely to suffer a serious illness than die before the age of 65. The cost of this type of insurance is higher than life assurance.
Those with a chronic medical condition or a history of poor health may find the policy is not available to them.
You should speak to a qualified adviser before committing to this type of policy.
Please contact us for more information on rates and providers.