Critical Illness Insurance Articles & Guides

Critical illness cover pays a tax-free lump sum if you’re diagnosed with a critical illness during the term of the policy. You decide on the length of the policy: many people choose to have cover until their kids have flown the nest, until the mortgage is paid, or until they plan to retire.

Think of critical illness cover like car insurance: you pay every month or year for it and hope you never ever need to use it, but you feel better knowing it’s there. Just in case.

All critical illness covers include the main serious illnesses you might suffer from - coronary artery bypass, major heart attack, kidney failure, major organ transplant, multiple sclerosis, stroke and a defined set of specific cancers.

The list doesn’t stop there though, as plans can cover many more, along with cover tailored to your kids.

Read more about what is covered by critical illness insurance.

If you're unfortunate enough to need to make a claim, the insurer will assess your situation, and assuming your diagnosis meets the terms & conditions they will payout directly to you. We have a dedicated claims team to help you every step of the way.

Terminal illness cover pays out at the point you're diagnosed with a terminal illness, rather than when you're no longer here.

Critical illness cover protects you if you're diagnosed with a critical, but not necessarily fatal, illness during the length of your protection.

These products often get confused as they both pay out in the event of illness. However, whilst critical illness cover provides a lump sum when you are diagnosed with a covered illness, income protection insurance provides a regular portion of your income if you are unable to work.

The protection insurance market is huge, and insurers vary what they cover in their critical illness policies. We work alongside the top UK insurers, so let us get to know you and work with you to build a policy, catered to you.

As we all have different lives and circumstances this will differ from one person to the next. Some people may have a partner to help or children to think about. Others may be living by themselves as the only source of income. Our advisers can give some guidance around your options but here are some things to consider:

• Outgoings - how much are your essential bills (water, gas, electric etc) that you need to keep the household going each month?
• Rent or Mortgage costs - how much do you pay in rent each month, how much are mortgage repayments and what is the outstanding mortgage amount?
• Children or family - if you were unable to work due to illness would you need any money to support your family or children?
• Other debts - any outstanding loans, car finances or credit cards that would need to be covered.
• Medical costs - would you need to cover any expenses caused by a serious illness , such as possible adaptations to the family home or medical treatment.Savings - do you have anything put to one side that you could rely on in event of a serious illness.

You may think your children don’t need critical illness cover. They don’t have cars or rent, or dependents to look after. But you do. If your child is critically ill, you or your partner may need to take time off work or possibly leave your job to care for them.

Many critical illness policies cover your children as part of your plan. Some will do this automatically, others will charge a fee and some won't cover them at all. The ones that do provide cover will typically pay out a proportion of the adult sum assured, up to a maximum of around £25,000.

Make sure you know what your children are covered for under your plan. As this varies by provider, so its worth checking how your children will be covered under your policy.

When taking a critical illness plan it is possible to cover yourself and your partner under one 'joint' policy. This can be cheaper than having individual cover on each person, but the policy will only pay out once. So if one of you claims on the policy then there would then be no further cover in place.

Taking out two individual covers provides the potential for two separate payouts - if one of you were to make a successful claim then the other would still have some critical illness cover in place.

The difference in premiums between the two could be less than you think, so its worth checking out your options. Speak to our advisers who will be happy to help you work out the best option for you.

When you take out a critical illness policy you may be presented with options of Guaranteed or Reviewable premiums.

Guaranteed premiums typically remain fixed over the life of the policy so what you pay now will be the same at the end of the policy.

Reviewable premiums are periodically reviewed by the insurer who will decide at these intervals if they wish to increase the amount you need to pay for your cover. The insurer will usually base this on previous claim statistics, advances in medicine and economic factors. The premiums typically start off lower than guaranteed plans but may end up considerably higher.

The best option for you will depend on your own circumstances - speak to an expert LifeSearch adviser, who will be able to help you decide.