What is critical illness insurance? (A Complete Guide)

Critical illness cover is designed to help support you and your family should you become unwell – allowing you to focus on your recovery without worrying about how bills will be paid.

The two types of critical illness cover

There are two types of critical illness cover:

Additional cover policies which can pay more than once. I.e. it will pay out if you’re diagnosed with a critical illness and in the event of deathCombined cover will payout 100% of your chosen amount upon diagnosis or death, not both.

What is included in critical illness cover?

What’s included in critical illness cover will vary from provider to provider but generally speaking, most will cover the following:

Heart attackStrokeSome types of cancerSevere head injuriesOrgan transplants

Not every insurer will cover every type or occurrence of these illnesses, therefore you should always review the policy terms and conditions before proceeding.

What isn’t covered by critical illness cover?

Critical illness and terminal illnesses are classed differently by different insurance companies, so it’s important to always check your terms and conditions and/or speak to an independent broker who will be able to answer your questions.

Who needs critical illness cover?

Critical illness is designed to support costs if you become ill, so you might want to consider critical illness cover if you are:

Depended upon to support your family with your salaryDon’t have enough in savings to live if you were to become seriously unwellYour job won’t cover you for a long period off work due to sickness

Universal Credit standard allowance is £342.72 per month for single claimants under 25 and £409.89 per month for single claimants over 25 as of July 2020*. The amount for joint claimants will be slightly different. If you don’t feel this is enough to cover your outgoings should you become unwell, you may wish to consider critical illness cover. 

*Stats taken from the Money Advice Service website. 

How much critical illness cover do you need?

You need to think about the costs you’d need to cover if you were to fall ill and couldn’t work. This might include regular outgoings like your mortgage or rent, plus day to day expenses like shopping and energy bills.

If you have children, you’ll want to make sure you can still provide for them while you undergo treatment and recovery. It may be that you want your entire mortgage to be paid off in the event you become unwell. 

Can you get cover after being diagnosed with a condition?

Most insurers will ask you to complete a medical questionnaire when you take out your policy, during which they will identify any pre-existing conditions. It’s vital that you’re open and honest with the insurer as withholding information could invalidate your policy. 

Just because you have pre-existing conditions doesn’t preclude you from getting cover, it may just mean that you can’t get cover for illnesses which are directly related to that pre-existing condition.

How to save money on critical illness cover

Similarly to life insurance, the best way to save money on your critical illness cover is to compare the providers. You can get a free comparison quote by completing this quick form.