Last updated: Sep 21, 2023

What is Critical Illness Cover?

at Mortgages for Doctors

What is Critical Illness Cover?

We all have our own unique life journeys, and sometimes these paths can be littered with obstacles beyond our control.

In these moments, the greatest gift we can give ourselves and those we love is the security of knowing we’re protected in any eventuality.

This is where Critical Illness Cover comes in, a safety net for those facing a serious illness or injury.

Critical Illness Cover is, in essence, a type of insurance policy that provides a lump sum payment in the event of a specific serious illness such as a heart attack or a stroke. This payment can be used to cover bills, the mortgage and household expenses and provide financial support for loved ones while you focus on getting better.

It's important to understand the details of the policy, such as which illnesses or injuries are covered, the waiting period before coverage begins, and the level of coverage, but overall, having Critical Illness Cover is an investment in the wellbeing of ourselves and those we care about.

Definition of Critical Illness Cover

Critical Illness Cover provides financial support to people who are unable to work due to a critical illness. The term ‘critical illness’ refers to a specific set of serious conditions that can be life-changing. These can include certain stages of cancer, heart attack, stroke, multiple sclerosis, and many others.

Even the strongest and healthiest of people can be impacted by a critical illness, so it’s important to be prepared.

Without Critical Illness Cover you may have to resort to using your savings, relying on family and friends for support, or even losing your home. This can of course cause financial stress at an already very difficult time.

Critical Illness Cover helps to relieve the financial burden, and allows you to focus on your health and recovery.

How Critical Illness Cover works

Critical Illness Cover pays out when the policyholder is diagnosed with a specific condition that meets the insurer's definition.

The conditions covered vary between insurers, but they usually include things like heart attacks, strokes, cancer, and organ failure. The precise specification of the illnesses covered should be studied carefully before committing to a plan.

When taking out Critical Illness Cover, you pay a monthly premium to the insurance provider. The premium is determined based on numerous factors, such as your age, your health, your smoking status, and your medical history. If you're diagnosed with an eligible critical illness condition during the policy term (usually between five and 30 years), the insurance provider will pay out.

Benefits of having Critical Illness Cover

One of the most significant benefits of having Critical Illness Cover is the peace of mind it brings. Knowing that, should the worst happen and you’re diagnosed with a life-threatening illness, you'll be financially covered, giving you the reassurance you need to focus on your recovery.

Another benefit is that Critical Illness Cover can provide a lump sum payment. This lump sum can help you to keep life going financially while you’re unable to work. It can cover your mortgage payments and household bills. It can cover any family expenses. It can also cover any changes you might need to make to your home as a result of your illness.

Finally, Critical Illness Cover can also help you avoid dipping into your savings or taking out loans. This can give you the freedom and flexibility to take the time you need to recover without worrying about the financial consequences.

Factors to consider when choosing a Critical Illness Cover policy

It can be difficult to know where to start, but there are a few key factors to consider that can make the process easier.

First and foremost, you want to make sure that the policy covers the illnesses that are most relevant to you. Take the time to read through the policy, to make a note of any questions, and make sure you’re comfortable with what is - and isn’t - covered.

You'll also want to consider the payout structure of the policy. Some policies pay out a lump sum when you're diagnosed with a critical illness, while others will pay out in installments over a set period of time. Think about what would work best for you and your family in terms of managing potential expenses.

When comparing policies, it's important to take into account the premiums you'll be paying. Lower premiums may seem attractive, but they may also come with limited coverage. Make sure you're comfortable with the balance between premiums and coverage.

Finally, shop around and compare policies from different providers. Look for online reviews or ask for recommendations from friends or family members who have experience with Critical Illness Cover. It's important to find a provider that you trust and feel comfortable with.

If this sounds overwhelming, don’t worry, we’re here to help.

We have access to solutions and services that are designed to create the best possible plan for your situation.

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