Critical illness insurance, also known as critical care insurance, pays you a lump sum if you’re diagnosed with one of the conditions listed in your policy, regardless of the effect it will have on your ability to work.
Critical illness insurance, also known as critical care insurance, pays you a lump sum if you’re diagnosed with one of the conditions listed in your policy, regardless of the effect it will have on your ability to work.
Critical illness insurance is not a substitute for private medical insurance. It won’t pay for any treatment or hospital stays, only to support you through recovery. It’s designed to help meet day-to-day costs such as paying your mortgage, bills and childcare while you’re off work.
Anyone can apply for critical illness cover at any age – but premiums will be higher the older you are when you buy it. The policy may also have age restrictions so check before committing – there might be an upper age limit.
Critical illness policies usually cover about 25 illnesses and each provider may offer slightly different cover.
Critical illness insurance covers a range of illnesses, including:
- Cancer
- Heart attack (myocardial infarction)
- Coronary artery bypass surgery
- Stroke (cerebrovascular accident)
- Paralysis or paralysis of a limb
- Aortic surgery or aneurysm
- Multiple sclerosis
- Motor neurone disease
- Kidney failure – end-stage renal failure
- Blindness, deafness or loss of speech
About 25 illnesses are covered overall. Each insurer may offer different coverage for each condition, and there may be a difference in how each insurer views “serious medical conditions” so make sure to check what is covered with the insurance provider. [LINK: https://www.comparethemarket.com/critical-illness-insurance/]
The cover you choose will depend on your health, age and family history.
There are many factors that affect the type of policy you need. The main ones are:
- your family history and age;
- your current health and lifestyle;
- your occupation, such as if you drive for a living or have dangerous hobbies;
- whether or not you smoke;
- how much cover you need, but also how much you can afford to pay.
It is possible to buy critical illness cover that only covers the illnesses that are most relevant to you.
Critical illness policies will cover a range of conditions, such as cancer, heart attack and stroke. So, you need to think about your personal circumstances to decide whether critical illness insurance is right for you.
You should consider:
- Your age – the younger you are, the cheaper it will be
- Your family history – if someone in your family has suffered from a serious health problem at a young age, then you may want to consider this insurance as it will normally be more expensive
- Your current health status – people with existing health problems may find it difficult or expensive to get this type of insurance. In some cases, you may even be unable to get it
- What other types of insurance do you have? You can buy some critical illnesses with your existing health insurance or life policy. It pays to shop around because policies vary greatly between providers. For example:
- some life insurance policies offer terminal illness cover that can pay out when someone is diagnosed as terminally ill (e.g., given less than 12 months to live)
- some income protection policies offer trauma cover that covers illnesses like cancer and heart attack
If you’re diagnosed with a critical illness, you’ll receive a large, tax-free payment from your insurer.
If you’re diagnosed with a critical illness, you’ll receive a large (often tens of thousands of dollars) tax-free payment from your insurer. You can use the lump sum to pay for medical treatment, take time off work to recover, and pay bills like your mortgage or rent.
Critical illness insurance can help when fighting against a serious medical condition
You’ll be able to claim a lump sum payment if you are unable to work due to an illness covered by your insurance. That way, you can take as much time as you need off work without worrying about making ends meet.
The illnesses covered by critical illness insurance may vary from policy to policy, but usually include:
- Cancer
- Heart attack
- Stroke
- Multiple sclerosis
While these often result in the biggest bills, there are other unexpected costs that add up. If the worst was to happen, critical illness cover could help pay for things like:
- Specialist equipment
- Home modifications and adaptations
- Childcare
- Travel expenses related to treatment