Article created by Christian Duncan, Director – Mortgage and Protection Adviser
Last updated 11th August 2023
As you journey through life, you’ll find that the only constant is change, and often, it’s unforeseen. Everyone dreams of owning a safe haven—a home. But home ownership doesn’t come without risks. Imagine being unable to meet your mortgage payments due to a serious illness. That’s where critical illness insurance comes into the picture as a vital safety net.
How Does Critical Illness Insurance Work?
Critical illness insurance is a type of protection that provides you with a tax-free lump sum payout if you are diagnosed with a specified type of severe illness or medical condition. Unlike health insurance, which restricts reimbursements to specified medical expenses, critical illness insurance has no such restrictions.
Understanding What Constitutes a Critical Illness
A diverse range of diseases is considered critical illnesses. These often include severe conditions such as specific types of cancer, stroke, and heart attacks. Other conditions like kidney failure, major organ transplant, paralysis, and multiple sclerosis are also commonly covered by critical illness insurance. The important thing to understand here is every insurers terms are different. This is why you should use an adviser to help find you the best policy in line with your budget.
Why Do You Need Critical Illness Insurance?
Critical illness insurance offers financial support when you need it most. It enables you to focus on recovery, rather than worrying about mortgage payments or other debts. Considering the cost of medical treatment and the potential loss of income due to inability to work, critical illness insurance is essential. Ultimately, critical illness cover gives you peace of mind.
Factors Influencing The Cost of Critical Illness Insurance
The cost of critical illness insurance can vary based on factors such as your age, health, gender, occupation, and lifestyle choices, including smoking. The amount of cover you choose directly impacts your premium too. The sooner you take critical illness cover out, the cheaper your premiums are likely to be.
The Pitfalls of Not Having Critical Illness Insurance
Without critical illness insurance, you put yourself at a substantial financial risk. With you being unable to work and having to attend frequent appointments with medical professionals costs can pile up. You may have to dip into life savings, or worst case, you may lose your home if you are unable to keep up your repayments.
Essential Considerations for Critical Illness Cover
Budget – Critical Illness cover is statistically claimed on more than life insurance. This is why the premiums are often more expensive. Its important that whatever policy you decide to take out. It remains affordable across the term.
Definitions – Every insurer has a different outlook and what constitutes a critical illness. It’s important that you and your adviser look through these to full comprehend what you will be covered for.
Claims Procedure – In an ideal world you will never have to claim on your critical illness policy. Unfortunately, we don’t live in an ideal world and there might become a time in your life where you need to claim. Our advisers will help you navigate the claims process to take the stress away from you at a difficult time.
Critical Illness Insurance: Is It Right for You?
Just like the decision to buy a house, buying critical illness insurance is a significant choice. While it may seem prudent for everyone to have such a policy, it is particularly beneficial for individuals with a history of critical illnesses in their family. Additionally, if your health insurance falls short, or if you have a substantial mortgage or dependents, critical illness insurance becomes even more crucial.
At the end of the day, life’s uncertainties make critical illness insurance a wise investment. Protecting yourself and your loved ones should be a priority. Ask yourself: when life throws a curveball your way, will you be prepared? Critical illness insurance can help ensure the answer is a resounding yes. If you would like to discuss a critical illness policy with use then please book a call with us here.