Critical illness insurance provides you with a lump sum cash pay out in the event that you develop a serious illness or disability. These insurance policies only cover long-term and serious illnesses that will affect your ability to work. Such illnesses or disabilities include heart attacks, strokes, loss of limbs, cancer, multiple sclerosis or Parkinson’s disease. The lump sum provided by the insurance policy can be spent however you may require. From paying off your mortgage to taking care of your household’s immediate financial needs, you are free to spend it as you desire. Critical illness insurance policies are quite specific about the conditions and eventualities they cover. Thus, you’ll usually have to be very seriously ill or completely incapacitated by illness for you to claim on the policy. Moreover, with the expensive nature of premiums combined with the fact you may never receive a pay out, the real question is whether critical illness cover is the right choice for you.
Is critical insurance cover for me?
If you are affected by long-term illness or disability, state benefits may not be enough to sustain your lifestyle. Depending on your eligibility, the government’s Employment and Support Allowance will only provide you a maximum of £100 per week. This too depends on the nature of your illness, disability or incapacitation from work. If this is not enough for you to survive, critical illness cover may be a worthwhile option. Furthermore, you should assess the extent of your savings and how long they might last, in case you fall ill. Should you not have an ample amount of savings, critical illness cover is definitely worth considering. Also, perhaps your employer makes provisions for extended sick periods. This is another thing worth checking, before considering critical illness cover.