What you need to know about Critical Illness Cover

Critical Illness Cover is a type of insurance that comes into effect if the holder is no longer able to provide for their family financially due to terminal illness or death.  The cover provides financial assistance in the form of a tax-free payment made as a lump sum or incremental monthly payments.
                            
At present, in the United Kingdom, there are over 60 providers of Critical Illness Cover, offering over 200 products.  It’s vital that you are well advised as to the correct type of cover for you.  Here’s what you need to know about Critical Illness Cover:

YOU NEED TO KNOW 1:
This type of Critical Illness insurance does not cover all illness and conditions, so it’s important that you read your policy carefully. The type of things not covered by most Critical Illness cover plans include:

 

The following conditions are regularly covered under this type of policy:

YOU NEED TO KNOW 2:
Most companies accept policyholders between the ages of 17-70.  The policy can run for as many years as you feel it is necessary, although most people use it to cover the duration of the mortgage repayments.

YOU NEED TO KNOW 3:

 The company that you buy your Critical Illness Cover from should be a member of the Association of British Insurer.  Always read the small print, be sure that you are buying the policy that you need.

YOU NEED TO KNOW 4:

Ensure that your policy says that it will pay out if you cannot do your particular job, rather than any job.  It’s clear that despite some conditions, you could change occupations and still be employable.

YOU NEED TO KNOW 5:

Most claims should be settled within 28 days of the diagnosis of critical illness or death.  However, if you have a permanent disability, it may take up to one year to assess and fully process the claim and make the final payment.  A full pay out from Critical Illness Cover can be used for any purpose, although many people use it to pay off their mortgage or other debts.  The standard payout, although policies vary, is between £100,000 and £250,000.

YOU NEED TO KNOW 6:

Critical injury is not the same as Critical illness, if you wish to be covered for Critical injury; you need to look for Permanent Health Insurance.

YOU FINALLY NEED TO KNOW:

Most of the policies have a cooling-off period of 14-days, which means that you can cancel the agreement without penalty up to 14 days after processing.  However, all policies differ and you should check the small print very carefully.

Hanson Wealth have offices in Boldon, Durham, Inverness, Standish and North Berwick. We have a community of independent financial advisers based throughout Scotland, England, Wales and Northern Ireland as well as a variety of services available over the telephone or via the internet. So even if you are not based near to one of our branches, we can still ensure that you will get quality independent financial advice from our IFA team.

Call free today on 0800 881 8085

9am - 5pm Monday to Friday or leave a message outside of these hours and we will call you back.