Critical illness cover: the facts
Choosing the right critical illness cover can be complicated. Every insurer and every policy has a different set of terms and conditions, so it can be hard to know which one is right for you. It is especially difficult because nobody can know if they are going to get a critical illness, let alone what kind of illness it would be. Here are the answers to some of the common questions that people ask about critical illness cover.
What is it?
In essence, it is a safeguard put in place to help ensure that you get a tax free cash sum if you are diagnosed with a critical illness. For you to receive a payout, the illness must be covered by your policy.
What can I use the money for?
People can use the payout however they like. Developing a critical illness could mean you are no longer able to work, so the money could help you and your family stay afloat. It could also contribute towards modifying your car, home etc. to make them more accessible if necessary.
Which illnesses are covered by critical illness policies?
The majority of plans at least cover conditions such as cancer, stroke, coronary bypass surgery, organ transplants and kidney failure. The number of conditions covered varies wildly from policy to policy. Make sure that you know exactly what is and is not covered before you buy a policy. For example, many policies cover cancer but not in its early stages. These are the kinds of details you need to be aware about.
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Which illnesses are not covered?
Again, this varies. Conditions that are commonly not covered include illnesses that are considered "self inflicted." This includes conditions that were caused by drug or alcohol abuse. HIV/AIDS is also not covered by all policies, but some policies cover it under certain circumstances - for example, if you contracted it as a member of the emergency services or a lab assistant handling contaminated blood samples.
Should I go for the policy that covers the most illnesses?
Not necessarily. Of course it's important to find a policy that covers a range of illnesses that you could be at risk from. There has to be a line, however. This is because some companies charge more for policies full of illnesses that, in reality, you would never even be exposed to. If you are not a big traveller you probably don't need a policy that covers tropical diseases, for example.
What will affect the cost of my policy?
Factors such as age, gender and occupation may affect your premiums. With critical illness cover you may also have to pay more if there are any relevant conditions on your medical records, or if a close family member has a relevant illness. If you smoke you should also be prepared to pay more.
Will my family be covered?
Not necessarily. If you have children, however, it may be advisable to find a policy that will cover them for no extra cost.
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