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Are Your Illnesses Critical
Summary
The important facts you should consider when deciding on critical illness cover and the varietyof companies tendering this kind of policy.
Your mortgage provider may give you several financial products including critical illness cover. But, as they are not specialists in this field, you will almost certainly find a better offer somewhere else.
The level of cover on offer is just as significant as the premium when seeking critical illness cover. The policies from Nationwide and Alliance and Leicester are extremely limited says an adviser at Tesco Finance, a telephone and online life assurance broker. Legal and General covers only eight critical illnesses, with Friend Provident covering just 9, whereas the market leader, Swiss Life, covers 39.
Loss of speech, deafness, blindness, diabetes, Aids and Parkinsons are some of the conditions not covered by some of the Insurance companies. The senior advisersays that it does not warrant considering a policy, which covers less than 24 ailments.
An umbrella term built into all policies is ‘total and permanent disabilities’, this term means you are insured for any illness, which stops you from working permanently.
You need to be alert to the lanuage as some policies cover ‘any occupation’ whereas other policies only cover your ‘own’ occupation. You will not receive a payout under a ‘any occupation’ policy unless you are completelyunable to carryout a job, however unskilled. Therefore The adviserrecommends you sign up for a ‘own’ occupation policy.
There are a large number of companies as well as Swiss Life who offer full insurance including Scottish Provident, Scandia, Zurich life, Friends Provident, Scottish Equitable, Liverpool Victoria, Norwich Union, Legal and General and Zurich Life.
For years life insurance has been sold by a mortgage company. This resulted in lots of people never buying critical illness insurance. There are five times as many claims on critical illness insurance compared to life insurance, when the consumer has taken out both kinds of insurance.
Life insurance cover is tremendously important, specially if you have family, as they will welcome the lump sum payment on your death. However critical illness cover should be the priority if you have debts to settle, particularly a home owner loan. The senior adviserconsiders critical illness to be more important as it covers the cost of your house and food, even if you are sick and unable to work.
The premiums will be larger if you are a smoker or heavy drinker and will also be more expensive if you are older. A decreasing term policy, which is aimed at people only wanting to insure the cost of their mortgage, is the cheapest.
One of Hamptons customers, a 25 year old non-smoker, who required£100,000 cover from a critical illness, long term policy, was given a price of £14-40 per month, which rose to 24 pounds 30 pence for smokers. However a senior adviserfrom LifeSearch recommended a policy, which gave both life protection
