The Pros and Cons of Critical Illness Insurance

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By Cai Bradley

on Monday 16 December 2019

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Critical illness cover – or CIC insurance – is a type of insurance policy that provides a lump-sum pay-out to policyholders that are diagnosed with an illness that is explicitly mentioned within their policy’s terms.

There are many different options available to us in the UK when it comes to life insurance, and it is a long-term commitment that could impact you and/or your family’s financial situation if you were to become ill or pass away. This is why, here at Unite Life, we can’t stress enough how important it is that you try to understand the benefits and potential drawbacks of each policy before signing on the dotted line.

This guide to the pros and cons of critical illness insurance will walk you through the key features of CIC, so that you’re well-equipped to decide whether it is the right policy for you, or whether you should be looking at other types of cover.

Remember, our friendly advisors are also on-hand to chat about your life insurance options if you need some additional assistance, just complete our short contact form and we’ll be in touch at a time that is most convenient for you.

Key critical illness cover pros and cons

As with all types of insurance, there are pros and cons to critical illness cover.

Each case varies, as individuals are certain to have differing requirements and needs, but there are a few key features that you should be aware of when determining whether it’s the right type of insurance for you.

Benefits of critical illness cover

The main benefits of critical illness insurance include the following:

  • It pays out if you’re diagnosed with any illness listed within your policy
  • The pay-out is tax-free
  • It can help cover your mortgage, rent, debts, home alterations and other expenses
  • It covers a range of common illnesses and severities (stroke, heart attack, etc.)
  • It’s flexible as the policyholder can choose the level of cover and range of conditions

It is also, of course, one of the few insurance policies that can pay out while you’re still alive, so that you benefit directly from the premiums you pay.

When someone is diagnosed with a serious illness and is unable to work as a result, it’s inevitably a very difficult time, both emotionally and financially, for the whole family. A critical illness cover pay-out ensures that you and your loves ones remain financially secure, so that you can focus on recovering from the condition, rather than worrying about paying the bills or providing for your family.

Potential drawbacks of critical illness insurance

There are, of course, some potential disadvantages to keep in mind, including: 

  • Age restrictions
  • Premiums can be high
  • Some illnesses are not covered (exclusions) and coverage varies with each policy
  • You might need expert advice as some policies can be complex

Although all policies are bound to have some exclusions, let our advisors know that you want specific illnesses covered and we will do our best to find the right cover for you. Most providers will allow you to add certain illnesses; it may increase your premiums slightly, but at least you will have a sufficient level of cover that you feel is necessary, and you will avoid the disappointment of being refused a pay-out for that condition.

Age restrictions don’t usually affect most policyholders, but it is a potential drawback for some. For example, some policies have an upper age limit of 74 and a maximum term of 50 years, with the policy ending when one of those limits is reached (which ever one is first).

In terms of needing expert advice, fear not, we’ve got you covered! Complete our short contact form and a trained member of our advisory team will call you back at a time that suits you.

The most common reasons for critical illness cover claims not being paid out include:

  • The illness isn’t covered by the policy
  • The condition isn’t serious enough to warrant a pay-out
  • You have caused the illness by using drugs or alcohol
  • Being untruthful and not disclosing information when applying for cover
  • A lack of medical documents

Do I need critical illness cover?

So, is it worth getting this type of cover? In short, it depends on your individual needs, but there are many circumstances under which it makes complete sense to opt for a critical illness insurance policy.

When should you get critical illness insurance?

  • When you don’t have enough savings to cover you if were ever unable to work due to a serious illness
  • When you don’t have sufficient sick pay from your employer to cover time off work as a result of a serious illness

Is it worth getting life insurance with critical illness cover as an add-on?

Critical illness cover is not the same as life insurance, but they are often sold together.

If you purchase life insurance with critical illness cover, it’s possible that you might save yourself some money in premiums, in comparison to getting a standalone CIC policy.

You may be able to get a more extensive level of cover with a separate critical illness policy though, but it depends entirely on the provider you opt for and your specific needs.

However you choose to take out critical illness insurance, remember to:

  • Ensure that you’re happy with the illnesses covered and you fully understand your policy
  • Check for any exclusions (very cheap policies could exclude many critical illnesses)
  • Set a level of cover that suits your needs (not just your budget)

What illnesses are covered by critical illness insurance?

One of the main benefits of critical illness insurance is that it covers a lot of the common conditions* that put people out of work in the UK, including:

  • Some types of cancer
  • Heart attack
  • Stroke
  • Paralysis or loss of limb(s)
  • Third-degree burns
  • Liver failure
  • Major organ transplant
  • Blindness or deafness
  • Parkinson’s disease
  • Alzheimer’s disease
  • Severe head injuries
  • Bacterial meningitis
  • Multiple sclerosis

*Many policies will exclude certain types of cancer, and some providers will only pay out for conditions that are of a specific severity, so be sure to check the terms of your critical illness insurance policy before it’s too late.

One million workers find themselves out of work due to an illness or injury each year in the UK, which is why so many people opt for critical illness cover as a safety net to fall back on should the unexpected happen.

Best critical illness cover in the UK

If you’re looking for the best critical illness insurance in the UK, you have come to the right place.

Here at Unite Life, our trained advisors are happy to assist you in finding the most suitable cover for you, at the most affordable price. We will help you take out cheap critical illness cover that provides an adequate level of protection, so that you don’t get into difficulty with exclusions when the time comes to claim.

Even if you feel that critical illness cover isn’t for you, our team of experienced advisors will talk you through the various other insurance options available to you. Alternatively, you could browse the resources available on our website for further information.

Unite Life insurance and critical illness cover

If you’re thinking about getting a quote, feel ready to take out a policy, or simply want to talk about your options, call us on 08000 106 194 or complete our short contact form for a free, no-obligation chat with one of our friendly advisors.

08000 106 194

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