What is Critical Illness Insurance

An insurance policy that is usually paid out in the form of a lump sum if you are diagnosed with a chronic (i.e. long term) or life threatening illness or if, for any reason, you become permanently disabled. Policies vary in terms of the conditions covered but, typically these would include: heart attack, stroke, cancer, multiple sclerosis, motor-neurone disease. It's important to bear in mind that the benefit is paid out on diagnosis. If you subsequently recover, so much the better - there's no "claw back"!

Being diagnosed with a critical illness the odds are higher than probably any of us would care to acknowledge. Each year almost 220,000 people are diagnosed as new cancer registrations, which would qualify as a claim under the Association of British Insurers standard illness definitions applying to Critical Illness policies.

Thanks to the skill of doctors and continuous advances in medical research and technology, many people now survive heart attacks, strokes and even cancer. The good news is that people are more likely to survive such serious illness and live for a considerable time than ever before. The not such good news is inevitably concerned with the financial aspects of being in this position. If you have life cover to protect your loved ones it won't benefit you as any money will only be paid on death. Most people who are diagnosed with a serious illness will need to re-assess many aspects of their lives. They may not be able to work for a period of time and feel that, assuming they return to work, they would like to return to a less stressful environment. It is highly likely that income will suffer in the short term, and returning to any kind of work may not be possible. It may be that modifications need to be made to your home because of the nature of your illness, or a partner may need to give up their job in order to look after you.

Whatever the nature and implications of your illness, what would really make a difference is a policy which helped you at the time when you most need it.

Critical Illness

  • This provides a lump sum on the initial diagnosis of a serious medical problem
  • Available on a specified term and a whole of life basis
  • Can be provided with life assurance in the same policy

    • Typically, the majority of claims arise from a few illnesses like cancer, heart attacks and strokes Ideal way of paying off a mortgage or loans in the event of serious illness, meaning there is one less thing to worry about Policies do vary but all pay if you suffer a heart attack, cancer, a stroke or kidney failure or need a coronary bypass or transplant. Critical Illness can be set up as a stand-alone policy or can be incorporated with your life cover policy for an extra charge.