Critical Illness (CIC)

What is critical illness cover?

Critical illness cover is a form of insurance which pays out a tax-free lump sum if you are diagnosed with a specified illness or medical condition during the term of the policy. 

 

Do I need Critical Illness cover?

State benefits might not be enough to replace your income if something goes wrong and you can’t work because of long-term sickness or disability. If you’re eligible, Employment and Support Allowance ranges from around £70 to just over £100 a week, depending on your circumstances and the seriousness of your illness or disability.

 

You should look at getting critical illness cover if:

• You don’t have enough savings to tide you over if you become seriously ill or disabled

• You don’t have an employee benefits package to cover a longer time off work due to sickness.

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Is Critical illness worth it?

If you consider your loved ones might struggle to pay the mortgage or meet the cost of running a household if you were taken ill, then perhaps you should consider critical illness insurance.

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What is the best critical illness cover?

The best critical illness cover is one that can cover you for exactly what you want it to. Plus one that is affordable for your financial circumstances.

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What’s the difference between critical illness insurance, terminal illness insurance and long-term care insurance?

Critical illness insurance is like terminal illness insurance. However, the list of the covered critical illnesses will be different. The critical illnesses for terminal illness insurance usually relate to those where you are not reasonably expected to survive for more than a year after the date of patient diagnosis.

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Long term care insurance is exactly that – it will pay for the expenses involved in your long-term care should you need it. This includes payment for a health care provider or caregiver who will help you with daily living activities that you may not be able to do due to a disability or a medical condition.

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Critical illness usually pays out a lump sum while long term care policies are paid calculated on a monthly or daily basis.

 

How much Critical Illness cover do I need?

Use these tips to help you decide how much critical illness insurance you need:

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Firstly, multiply your annual income by three. This is because when you get critically ill, you may need to stop working. Trebling up means you can afford to rest from work for up to three years and still be able to pay your usual bills and mortgage payments.

Don’t forget about how long your loved ones will be relying on your income. If getting a higher education for your children is part of the plan, how long will you need to provide for them? When will they become financially independent?

Next, add up your monthly expenses, such as rental or mortgage payments, car fuel and running costs, groceries, medication and home care. Add this up and then deduct expected income from other sources, such as your spouse, Social Security and so on. Multiply the total amount and then multiply this by the number of years you expect to be laid up due to a serious illness.

The minimum cover recommended should be at least 75% of your total monthly debt service payments.

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Some questions you also need to consider when you are choosing your critical illness coverage:

How long do I need the critical illness cover for? What benefits should I look for? Shall I add in expected medical expenses? Do I need to consider savings and liquid assets? How much savings do you currently have? Do you have further assets you could use as emergency funds? How will this help cover the cost of treatment, as well as your family’s needs? How much state benefits do you stand to get?

 

The amount you get will be roughly the equivalent of the sum assured you should get, if you can afford this.

 

Does Critical Illness cover include all types of cancer?

No, some cancers are not covered by policies. Early stage cancers that are not considered “critical”, like breast cancer, ductal carcinoma in sit (DCIS) and non-malignant tumours are excluded from most covers.

 

Do I need critical illness insurance if I already have health insurance cover?

Health insurance will help considerably to your recovery, but it won’t be enough for the full duration and every aspect. Your health insurance will have a maximum limit which will mean that expenses after this point will have to covered by yourself if you don’t have a critical illness policy. Certain categories will require further expenses as these will no longer be payable by the policy. There are also elements that are not covered by health insurance claims. Your related expenses, loss of income whilst a patient at hospital etc. Critical illness cover benefits you by helping to pay for your bills and household needs, as well as pay off loans etc.

 

Why should I need critical illness cover when I already have life insurance?

With the breakthroughs in modern medicine, if you get critically ill, chances are, you can still survive and even recover from a critical illness. However, for the treatments you will need to battle and conquer the illness, you will need significant funds. Critical illness insurance will cover you and pay-out for this. You don’t want your family’s finances to be jeopardised so this will help in providing for your family’s needs at this challenging time.

 

Can I buy Critical Illness cover for me and my partner?

Yes, you can get a joint critical illness cover so that if either of you get critically ill, you can claim the funds you need.

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Do I need critical illness cover for my children?

Some children’s critical illness cover may be free, if you are covered for the same policy, subject to the terms and conditions. This may depend on the assessment. Why not have coverage for your kids, critical illness can happen at any time.

 

How do I make a claim for critical illness?

We don’t wish for this to happen to you, but if you are; As soon you are diagnosed with a critical illness make sure it is covered by your critical illness policy. Then, notify Cover My Bubble or your insurance company about this. They insurance broker or insurance provider may require further proof such as:

Diagnosis from the doctor who gave you the unfortunate news, who should specialize in your illness

Test results that show proof for the patient diagnosis. For example, a biopsy may be requested to confirm a cancer diagnosis.

The specific definitions of the critical illness will be outlined in your insurance policy.

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I already have been diagnosed with heart disease. Can I still buy critical illness cover?

The chances of you getting cover are unlikely. Many critical illnesses are linked to heart conditions. The same goes with other pre-existing conditions such as multiple sclerosis, gynaecological conditions and others that may likely result in more medical complications.

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Does critical illness cover have any exclusions?

Yes. You will be excluded from taking out critical illness cover if any of these apply:

 

• Illegal or criminal activities

• Abuse of illegal drugs, alcohol and other addictive substances

• Complications from AIDS or HIV

• Attempted suicide or self-inflicted injury

• War, riots and civil disorders

• Failure to follow reasonable medical advice

• How will my critical illness claim be paid?

• The pay-out will be made as a lump sum based on the amount your originally insured.

• When will my critical illness claim be paid?

• The pay-out for your claim is usually sent out to you within 30 days.

 

Can I spend the pay-out from the critical illness cover how I want?

Yes, once the money is paid to you, you can spend it however way you wish. Please bear in mind that you may need to spend the pay-out on special treatment that will prolong and further improve your quality of life. Also, you may wish to spend it to pay for your bills and needs of your family, as you may have been off work for some time, without income. You may wish to fit out your house with facilities to aid your recover or even treat yourself and the family to that dream holiday to spend precious time with the ones you love.

 

Can I claim for more than one critical illness?

No, once the pay-out is completed for one covered critical illness, the policy will be considered terminated and no other further pay-outs can be made.

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What can I do if my critical illness cover has already expired?

You may be able to renew the cover if the critical illness insurance has the option. If you don’t have a renewal option, you will need to apply for a new coverage but if your already diagnosed, you may have high premiums or may not even be able to get cover.

 

Can I change the amount of coverage once the policy is issued?

Yes, you have the flexibility to amend the amount of coverage for your critical illness policy, subject to the terms and conditions. Adding to your coverage amount may mean additional underwriting. Reducing coverage is easier to do.

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