UK - Critical Illness Cover

Choose from a wide range of critical illness cover products. Each one can be tailored to suite your specific needs interms of budget, benefits and level of cover.

Critical Illness Cover is a policy that provides insurance should you suffer a critical illness. The critical illness must be a specified medical condition, such as cancer. The critical illness insurance policy will pay out a lump sum on the diagnosis of one of the specified medical conditions.

• The mortgage will still need to be paid
  
• The bills will continue to drop through your letterbox
  
• You may need to pay for ongoing medical attention
  

A person taking out a critical illness insurance policy will pay level premiums. The amount of the premiums will depend on certain factors, such as age, whether or not you smoke, family history (many critical illnesses are hereditary), and the level of critical innless insurance cover required.

It is vital when critical illness cover is taken out that you understand the medical conditions that give rise to a claim. Certain conditions could be described as critical, but if they are not on the list of conditions covered by the policy, then they will not be paid out on diagnosis. Also, it is vital that you understand what treatment is acceptable as well. Some insurance companies will not pay benefits if you choose to be treated by certain methods (eg. laser treatment) as, ultimately, the company will want to make sure that you are getting the best treatment possible in their opinion.

As far as tax is concerned, it is important to note that there is no tax relief on premiums for critical illness policies. However, the lump sum that is paid out will not be taxable.

This cover is a result of the advances in medical know-how, which is allowing people to survive and perhaps enjoy life both during and after they have suffered a serious health problem like a heart attack or a stroke. If a person does survive something like this, they will still have a mortgage and bills to pay, yet you may be not well enough to work.

People who would be best suited to the policies are single people, who would need to buy in help, as it is less likely they'll have people to care for them. Family men or women also would benefit, especially if their family would encounter financial problems if they weren't earning. People with a family history of critical illnesses would be well advised to buy cover, although they should expect premiums to be higher. Finally, businesses need key people to be covered for this.