Critical Illness Cover Advice

What is Critical Illness Cover?

Critical Illness Cover is a type of insurance that is designed to pay out a tax free lump sum if you are diagnosed with one of the specified serious illnesses named in the policy during the term of cover.

Policies vary between insurers, but many are designed to cover serious conditions such as certain cancers, heart attack and stroke, subject to the insurer’s policy wording and definitions.

The purpose of the cover is to give you financial support at a time when your health may prevent you from working as normal or place extra strain on your household finances. The money could be used in whatever way is most helpful to you and your family, whether that is reducing your mortgage, covering bills, funding time off work or adapting your home.

Because cover varies between providers, it is important to understand what is and is not included before you choose a policy.

Book a call back from an adviser

How does Critical Illness Cover work?

Critical Illness Cover usually runs for a fixed term, for example to match the length of your mortgage or until a chosen future date.

If, during that term, you are diagnosed with a specified condition that meets the insurer’s definition in the policy, a lump sum may be paid. The policy would then usually end after a successful claim.

The amount of cover you choose will depend on your circumstances. Some people want enough to help clear a mortgage. Others want a smaller amount to provide a financial buffer if they needed time away from work.

When arranging cover, there are a few important things to think about:

• How much cover you may need
• How long you want the policy to last
• Whether you want Critical Illness Cover on its own or alongside Life Insurance
• Whether you need the cover to protect a mortgage, your family or both
• What your budget is each month

At Your Mortgage Expert, we can talk you through these choices and help you compare suitable options.

Do I need Critical Illness Cover?

Critical Illness Cover is not right for everyone, but it can be worth considering if other people depend on your income or if your household would struggle financially following a serious illness.

You may wish to consider it if:

• You have a mortgage or other major monthly commitments
• You have children or a partner who rely on your income
• You are self employed or have limited sick pay
• You want financial support in place if illness affected your ability to work
• You would like a lump sum available to reduce financial pressure during recovery

For many people, a serious illness would not just be a health shock – it could also affect work, income and day to day living costs. Critical Illness Cover can help provide breathing space at a time when money worries are the last thing you want to be dealing with.

Book a call back from an adviser

What does Critical Illness Cover usually include?

Each insurer has its own list of covered conditions and its own definitions, so it is important not to assume all policies are the same.

In general, policies are designed to cover a defined list of serious illnesses, provided the claim meets the insurer’s criteria. Some policies also include partial payments for certain less severe conditions or additional benefits, but this varies.

This is one of the reasons advice can be valuable. The cheapest policy is not always the most suitable one if the definitions or features are weaker than another option.

Before taking out cover, we will help explain:

• the level of cover available
• the term of the policy
• whether the cover is single or joint
• any key exclusions or limitations
• how one insurer’s features compare with another’s

For full details of what is covered and how claims are assessed, you should always refer to the insurer’s policy documents and Key Features.

Critical Illness Cover vs Life Insurance

This is one of the most common questions people ask.

Life Insurance is designed to pay out if you die during the term of the policy.

Critical Illness Cover is designed to pay out if you are diagnosed with a specified serious illness that meets the insurer’s definition during the term of the policy.

In simple terms:

• Life Insurance protects against death
• Critical Illness Cover protects against certain serious illnesses
• some people choose one
• some people choose both together

If your priority is making sure your family could pay off the mortgage if you died, Life Insurance may be the main focus.

If your concern is what would happen if you survived a serious illness but could not work as normal, Critical Illness Cover may be worth considering as well.

Many people choose a combined approach so there is protection in place for more than one eventuality.

Book a call back from an adviser

Can I have Life Insurance and Critical Illness Cover together?

Yes. In many cases, Life Insurance and Critical Illness Cover can be arranged together on the same policy or as separate policies, depending on what is most suitable.

This can be a good option for people who want broader protection for themselves and their family. For example, you may want cover in place both if you were to die and if you were to survive a serious illness that affected your income or lifestyle.

The right setup will depend on things such as:

• your mortgage balance
• your age
• whether you have dependants
• your budget
• whether you want single or joint cover

We can help you compare the different ways of arranging cover and explain the pros and cons of each.

Critical Illness Cover for a mortgage

Many people look at Critical Illness Cover when taking out a mortgage or reviewing their protection later on.

That is because your mortgage payments would still need to be met even if a serious illness affected your ability to work.

Some people choose enough cover to help repay all or part of the mortgage. Others choose a lower amount to act as a financial buffer while they recover.

If you are arranging a new mortgage, remortgaging, or reviewing your household protection, it can make sense to look at Critical Illness Cover alongside:

• Life Insurance
• Income Protection
• Family Income Benefit

Different products protect against different risks, so it is important to understand how they work together.

At Your Mortgage Expert, we regularly help clients review protection alongside their mortgage arrangements so they can make informed decisions about the level of cover they want in place.

Is Critical Illness Cover worth it?

Whether Critical Illness Cover is worth it depends on your personal circumstances.

For some people, the answer may be yes because they have children, a mortgage and limited savings or employer benefits. For others, the priority may be elsewhere.

A useful question to ask is:

If I became seriously ill and could not work as normal for a period of time, how would that affect me and my family financially?

If the answer is that it would put pressure on your mortgage, bills, savings or long-term plans, then it may be worth exploring your options.

The goal is not to take out cover for the sake of it. The goal is to make sure you understand the risks, know what protection is available, and choose cover that fits your circumstances.

Book a call back from an adviser

How we help

At Your Mortgage Expert, we do more than just generate a quote.

We help you:

• understand what Critical Illness Cover is and how it works
• compare options from a wide panel of insurers
• decide whether you need cover on its own or alongside Life Insurance
• choose a suitable level of cover for your mortgage, family and budget
• understand key differences between providers

We know protection can feel confusing, especially when different policies use different definitions and features. Our role is to make the process clearer and help you make an informed decision.

Whether you want to put new cover in place or review what you already have, we are happy to help.

Book a call back from an adviser