If you’re looking for a way to protect your family from the financial burden of an unexpected illness, then critical illness insurance is one of the best options available. It can compensate for the loss of income which results from being unable to work.

But before you apply, it pays to understand the benefits and drawbacks of owning a policy. We'll discuss some of the pros and cons of critical illness insurance, and why you should consider buying cover.

What is critical illness insurance?

Critical illness insurance is a type of insurance policy that provides a lump sum payment if you become seriously ill or injured. It helps provide financial protection for you and your family when you need it most.

You can use the money to meet everyday expenses, such as mortgage payments, household bills, and private medical treatment.

The policy pays out in the event you are diagnosed with a critical illness or serious injury covered under your policy agreement. Such illnesses can include:

  • Heart attacks

  • Certain types of Cancer

  • Stroke

  • Kidney failure

  • Liver disease

  • Multiple Sclerosis (MS)

  • Parkinson’s Disease

  • Alzheimer's

  • Loss of limb/sight

  • Total and permanent disability

Not all illnesses are covered, and each insurer has their own list of conditions that you will be covered for, so be sure to shop around to get the plan you want.

Just like any type of insurance policy, you are required to pay a monthly premium for cover. The cost of these premiums depends on a number of factors, such as age, health, and the amount of cover needed.

You will also be required to fill out an application form covering your health and lifestyle. It is important to answer these questions as honestly and accurately as possible as failure to mention something important could result in an application being declined. This process is called underwriting.

Learn more about underwriting.

Talk to a Critical Illness expert today...

Why do I need critical illness cover?

If you are healthy, you probably won’t consider buying critical illness insurance. However, there are a number of reasons why a critical illness plan could be suitable. If you need time off work to recover, the funds could help you pay your rent or mortgage, your utility bills and other day to day costs. This allows you to focus on simply getting better.  

Another thing to consider is that critical illness cover will usually also pay out if you died. If you have a family that are dependant on your income, and you unexpectedly pass way, then they may not have enough funds to pay off debts, mortgage repayments, funeral costs or day-to-to-day living costs etc.

Since critical illness cover also usually includes serious injuries like loss of limb, sight or deafness, you might also want to think about buying cover if you work in a high-risk industry where you could face a serious accident or injury at any time.

For example, if you work in construction, mining, engineering, manufacturing, or anything else high-risk, you could be exposed to dangerous chemicals, machinery or heavy equipment. In these situations, it makes sense to take out critical illness insurance to protect yourself and your family.

You can talk to one of our expert advisers about Critical Illness Cover by calling:

01392 436 193

Pros of critical illness insurance

  • Protects you from the unexpected - When you purchase critical illness insurance, you know that you will receive a payout if you fall victim to an illness or injury covered by your plan. This gives you confidence knowing that you won't leave your loved ones struggling financially should the worst happen.
  • Provides peace of mind - When you purchase critical illness insurance, you know that you will receive a lump sum payment if you suffer from a covered condition. You can use this lump sum for anything you like, from covering your mortgage/rent payments and utility bills, remodeling your home to be more accessible if you have a permanent disability or even taking a break from work to focus on getting better.
  • Provides financial security -A critical illness policy could help provide financial security for your family when you're no longer around as most also payout upon death. This can make a big difference to your loved ones' lives.
  • Could help reduce debt - If you are struggling to keep up with your household bills, then critical illness cover can help you get back on track. By using the money to pay off debts, you can free up more money to spend elsewhere.

Cons of critical illness insurance

  • Costly -Critical illness insurance isn't always cheap. You may be faced with a higher premium if you are older, a smoker, or have a family history of illness.
  • Not all illnesses are covered - some illnesses aren't covered by insurance companies. For example, certain types of cancer and non-fatal diseases are often excluded from cover.
  • Doesn't always cover death - Most critical illness policies would pay out in the event of you becoming critically ill or upon death - whichever happens first. However, it is not automatically included in every plan, so be sure to check the Terms & Conditions before purchase.
  • Limited benefits - Some policies only offer limited benefits. They don't cover everything that you'd expect from a standard medical insurance policy. For example, many policies exclude pre-existing conditions, meaning that you may not be covered for ongoing medical conditions or something you have had in the past.
  • May exclude pre-existing conditions –Similar to life insurance, you will need to complete an application form for critical illness cover that will ask questions regarding your health and lifestyle. If you have previously suffered from one or more of the conditions covered on the plan, your insurer may choose to exclude it, or may increase the price of the policy.
  • May exclude family history – If you have a family history of certain illnesses or diseases that the plan would cover, then your insurer may opt to exclude it from your plan or may choose to increase the monthly premium.

    This isn’t always the case though, so don’t be discouraged from applying, and remember to shop around as different insurers may have different results.

    To streamline the process, you may want to consider speaking to an adviser who can compare the whole of the market and provide advice on your best option. You can call our team on 01392 436 193.

Please note: The insurance products offered by Cavendish Online have no cash-in value at any time. If you stop paying your premiums your cover will stop, your policy will end, and you will receive no benefit. If you have not claimed before the end of your chosen policy term, the policy will end, and no benefit will be paid.

How much is critical illness cover?

The price of critical illness insurance varies on a number of different factors. These include:

  • Age - The cost of critical illness insurance increases as you age. As you get older, so does the risk of suffering from a chronic illness.
  • Smoking status - Smokers typically pay more for their critical illness insurance than non-smokers.
  • Family history - People who have a family history of serious illness sometimes pay more for premiums.
  • Pre-existing conditions -Pre-existing medical conditions, such as diabetes, previous cancer treatment, and heart disease, can increase the cost of your premiums, and in some cases it may not be possible to secure critical illness insurance.

If you don't want to go down the critical illness route, you might want to look into term life insurance instead. This type of policy covers death only rather than illness. It provides your family with a cash lump sum upon your death, supporting them with various living costs. However, it only protects you for a set period of time.

If you're looking to apply for critical illness cover, or you're unsure about your options, speak to an adviser. They’ll provide guidance as to whether you may need life cover or critical illness cover. They'll also take into account your circumstances, as well as how much cover you may require.

Speak to the experts...

Give our advisers a call today.

Our team of friendly and professional advisers are on hand to help with any questions you may have regarding Life Insurance.

The advisers can also make recommendations tailored to your current situation and will research the market on your behalf, ensuring you secure the cover you need and supporting you every step of the way. 

01392 43 61 93(Monday to Friday, 9am - 5.30pm)

Request a callback

Apply with advice

Can I get life insurance if I have pre-existing conditions?

Prev article

Death in service vs life insurance - How do they compare?

Next article