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What Is Covered By Critical Illness Insurance?

LifeSearch author Zuky Edgar
3 min read

by Zuky Edgar, Marketing Executive

See author bio

Zuky brings her passion for writing and storytelling to helping customers get all of the information they need to Protect themselves and their loved ones.See author bio

Guide last reviewed 10 Oct 2023

Critical Illness Insurance is there to protect you and your family if you’re unfortunate enough to become diagnosed with a specific medical condition or illness. It pays out a tax-free lump sum to keep things ticking over financially whilst you’re recovering and not working, or to pay for the cost of treatment so that you can focus on getting better.

If you’re someone who depends heavily on your salary to support you and your family and you don’t have enough savings to rely on should you become seriously ill or disabled, then Critical Illness Insurance is something to consider. Some policies even pay out if it’s your children that get ill so that you can be there when they need you most.

What are the main illnesses covered by Critical Illness Insurance?

Unfortunately, there’s a huge number of illnesses and disabilities out there that can affect any one of us. As great as it would be, Critical Illness Insurance can’t cover absolutely everything. You might come across a policy that will cover 10 main illnesses, another will cover around 40 and some might even cover up to 100. Most policies will always include the ‘main’ illnesses which include a coronary artery bypass, a major heart attack, kidney failure, a major organ transplant, multiple sclerosis, a stroke and a defined set of specific cancers.

So, it makes sense to opt for the most extensive cover available, right? Maybe, if your budget can stretch that far, but it’s important to note that you may only be able to claim on some illnesses if they are in the advanced stages or if they will result in permanent symptoms. Always check the specifics with your provider. And remember, you can often personalise your cover and add on any extra specific illnesses that aren’t included that you might be particularly worried about.

When arranging your cover and getting a quote, you will need to give your adviser details about your medical history so that they can determine how much of a risk you are. It might be tempting to leave out minor details that may bump your premium up a little but it’s so important to be honest. Your insurer could void any future claims if they find out that the information on your application isn’t 100% accurate.

How exactly does Critical Illness Insurance work?

When you claim on Critical Illness Insurance you’ll receive a lump sum payment to help with your financial commitments whilst you’re not able to earn a living. One of the first things to do when setting up your cover is to consider whether you want to take out level, increasing or decreasing cover.

With increasing cover, the amount of cover and the amount that you pay can both go up each year in order to protect against inflation. This is good for people - and in particular, families - who want to make sure that their salary and living costs are covered by their payout. In contrast, the value of decreasing cover goes down each month but what you pay stays exactly the same. If you want your payout to cover any loans or debts that you pay off monthly such as a mortgage, then decreasing cover would suit you perfectly.

Next, you’ll need to decide how long you want your policy to last. Most policies will end once you’ve made a claim but hopefully, you won’t need to claim and you can keep your policy going until you’ve paid off your mortgage or until your children are through education. It’s worth noting that Critical Illness Insurance does not usually pay out if you pass away, so if you’re looking to make sure your family are provided for when you’re not around then this is where Life Insurance comes in. The good news is that you can combine these two policies so that you’re covered in all eventualities.

Although we might not like to admit it, illness or injury could happen to any of us at any time. If you have a family and financial responsibilities then Critical Illness Insurance should definitely be on your radar.

Find out your critical illness insurance options and get a policy that fits your needs

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LifeSearch author Zuky Edgar
Zuky Edgar Marketing Executive
A ‘Searcher since 2020, Zuky is a self-confessed ‘book bum’ and has big following for her book blogs and social media accounts. She brings her passion for writing and storytelling to helping customers get all of the information they need to Protect themselves and their loved ones
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