Do I Need Critical Illness Cover?

Do you need critical illness cover?

Critical illness cover, also known as ‘CIC’ or critical illness insurance is an insurance product which pays out a one-off tax-free lump sum to holders who contract a serious illness that is listed within the policy.

This lump sum can help cover costs including expert treatment, rent, debts, or specialist equipment you may require.

This blog will analyse, what’s included in the cover, who needs it, what affects the price and how to set it up through your financial adviser.

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What is critical illness cover?

Critical illness cover pays out a lump sum to policyholders if they get one of the medical conditions or impairments which are listed within the policy.

It is important to know that not all medical conditions are covered within a policy, moreover, the policy will often state the degree of severity, an illness must be, in order for the policy to payout.

Some life insurance policies are packaged with critical illness cover, others are not. Ensure you understand what level of cover you have by speaking with your financial adviser.

A further inclusion is often TPD (total permanent disability) which will payout if the policyholder falls victim to a certain level of disability (defined within the policy)

Critical illnesses which are commonly covered include:

  • Cancer
  • Stroke
  • Multiple sclerosis
  • Cardiac arrest

When the insurance pays out, the policy ends. The insurance will only pay out once.

What isn’t covered?

Not all serious illnesses are covered, each insurance provider will have different set conditions. Moreover, pre-existing health conditions are unlikely to be covered. You must ensure you read and fully understand your policy guidelines.

Who needs critical illness cover?

You should consider critical illness cover if your;

  • Existing savings will be insufficient to cover loss of income and/or treatment costs which arise from a critical illness.
  • Current employee benefits package (if you have one) will be insufficient.
  • Current health arrangements will be insufficient to gain you access to the best possible treatment.

Receiving a critical illness payout can make your life a lot easier during what can be an extremely difficult time.

How much does it cost?

The cost of cover depends on factors including;

  • Your age
  • The amount of cover you wish to take out
  • Whether you smoke or not, or if you have previously been a smoker
  • Any pre-existing health conditions along with your current health including metrics such as BMI
  • Your family medical history
  • Your occupation and lifestyle – which could put you at greater risk
How to get cover

If you are already a client, please contact your financial adviser who will be happy to talk you through the options available.

If you are not yet a client, please follow this link to find out more.

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deVere Insights is a proud component of the deVere Group. Our company has always prided itself on leading the way in the sphere of wealth management. This website is in place to share information and expertise.