Wondering if you need critical illness and what it covers? Read this handy guide.

Critical illness cover is an insurance policy that pays out a tax-free lump sum if you are diagnosed with a serious illness covered by your policy. 

Conditions covered by critical illness

Critical illness policies typically cover long-term conditions such as heart attack or stroke, major cancers, loss of arms or legs, multiple sclerosis and Parkinson’s disease. The number of conditions covered can vary depending on the insurer. Other illnesses that may be covered, depending on your policy, could include organ failure, coma, paralysis, blindness, deafness and Alzheimer’s disease. 

When applying for cover, it’s important to let a prospective insurer know about any pre-existing conditions you may have. If you don’t, this may void your policy in the event of a claim.

Make sure you check your policy carefully as although heart attacks, cancer and stroke are covered by almost all policies, a mild heart attack or early stages of cancer may not be covered – you may need to have permanent symptoms in order for a claim to be considered valid.

Peace of mind for your family

It is worth having critical illness cover if you have anyone relying on you for an income. It is advisable to buy a policy when you take out a mortgage. Although you are not legally obliged to do so, it will offer you peace of mind. However, you can also take a policy out if you are concerned about what would happen if you were unable to work and don’t have enough savings to cover your outgoings if you were to become seriously ill, or your employer doesn’t offer any benefits packages for long-term sickness. 

When seeking cover, shop around or speak to your financial adviser for advice. At Monica Bradley Associates, we work with a range of companies offering a variety of products and can advise you on the best product to suit your own personal situation. 

Check the premiums are fixed

It’s a good idea to compare the benefits, costs and allowances of various policies too. Make sure you check to see if the premiums are fixed which means the amount you pay will be the same for the duration of the policy. Before taking out a policy, you will want to consider how much cover you require and how long you would like the policy to last. We recommend that you calculate in advance what you would need to live on if you had a serious illness and were unable to work. The amount of cover you choose will affect the amount you pay each month. Your age is also a factor. The older you are the more you will have to pay. How much you pay will also depend on any pre-existing medical conditions you may have and whether there are any family members who have had any serious health conditions. Most policies offer fixed monthly payments. 

You can obtain critical illness cover for just yourself, but you can also take out a joint policy to cover you and your partner, or a family policy which would cover you, your partner and your children. 

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