Critical Illness

What is critical illness cover?

Critical illness insurance will pay out if you get one of the specific medical conditions or injuries listed in the policy.

But be aware that not all conditions are covered and policy will also state how serious the condition must be.

Don’t confuse critical illness cover with life insurance, although they are sometimes sold together.

Every year, 1m workers in the UK unexpectedly find themselves unable to work because of injury or illness.

Examples of critical illnesses that might be covered include:

• stroke
• heart attack
• certain types and stages of cancer
• conditions such as multiple sclerosis.

Most policies will also consider permanent disabilities as a result of injury or illness.

It only pays out once and then the policy ends.

Some policies will make a smaller payment for less severe conditions, or if one of your children has one of the specified conditions.

These plans have no cash in value at any time and will cease at the end of the term. If premiums are not maintained, then cover will lapse.

Plans may not cover all the definitions of a critical illness. The definitions vary between product providers and will be described in the key features and policy document if you go ahead with a plan.

Do you need critical illness cover?

State benefits might not be enough to replace your income if something goes wrong and you can’t work because of long-term sickness or disability.

If you’re eligible, Employment and Support Allowance ranges from around £70 to just over £100 a week, depending on your circumstances and the seriousness of your illness or disability.

You should look at getting critical illness cover if:

• you don’t have enough savings to tide you over if you become seriously ill or disabled
• you don’t have an employee benefits package to cover a longer time off work due to sickness.

How much does it cost?

Your monthly payments will depend on a number of factors, including:

• age
• the amount of cover you take out
• whether you smoke or have previously smoked
• health (your current health, your weight, your family medical history)
• job (some occupations carry a higher risk than others and might mean you have to pay more each month.