Updated August 2018

Your 5 Minute Guide to Critical Illness Insurance

What is Critical Illness Insurance?

Critical Illness is a long-term insurance which covers specific serious illnesses listed within the policy. If you get one of those illnesses, it will pay out a one-off, tax-free lump sum which could help to clear your mortgage and debts or pay for alterations to your home that you might need to help cope with your condition.

Critical Illness Insurance can be bought with Life Assurance, so often if a pay-out needs to be made, you would still have the reassurance of life cover to protect your family. However, some policies pay out on the first event only, i.e. death or critical illness, after which the policy would end.

What does Critical Illness Insurance cover?

The policy will state which illnesses are covered and how serious the condition must be. Most policies will cover conditions such as heart attack and heart surgery, some cancers, kidney failure, stroke, major organ transplants, Alzheimer’s and Parkinson’s diseases, coma, loss of limb and multiple sclerosis. Many policies will also cover permanent disabilities as a result of injury or illness and some may make smaller payments for less severe conditions or if one of your children has one of the specified diseases.

You will not be covered for health problems you knew you had before you took out the policy and some non-invasive cancers may also be excluded.

Why should I consider Critical Illness Insurance?

Critical Illness Insurance could prove invaluable if you (or your partner / spouse) don’t have enough savings to carry you through should you become seriously ill or disabled, if you do not have an employee benefits package to cover long term sick leave or if you’d be unable to pay your mortgage or rent. It could also pay for alterations to your home to provide wheelchair access, for example.

How much does Critical Illness Insurance cost?

  • Your age
  • The extent of the cover you need
  • Whether you are, or have been, a smoker
  • Your current health
  • Your occupation
  • Medical advances

Where can I find out more?

It’s important to compare Critical Illness policies before you buy because there are important differences between policies. How much cover you need will depend entirely on your personal circumstances. You should seriously consider seeking experienced financial advice to ensure the cover you get is right for you and your family.

Please note that this information is not fully inclusive and is intended to provide general information only. It does not constitute personal advice. We recommend you talk to your Brunsdon Financial Adviser for further information and qualified advice.

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