Burger Menu

Is Critical Illness Insurance Essential?

Critical Illness – Are you Covered? | MoneymanTV

Critical illness cover is an insurance policy that supports you financially if you are diagnosed with a severe illness.

When taking out the policy, it’s important that you mention any underlying medical conditions you have. The conditions you have disclosed may not be covered by the policy. Furthermore, if you have failed to mention the underlying medical condition, this could potentially mean your policy would be voided in the event of a claim.

The financial support will be from a lump sum of money that is a one-off payment to help pay your mortgage, medical, or if needed, modifications to your home.

What does critical illness cover? 

The insurance will cover you in the event that you are diagnosed with a particular medical condition or injury that is stated within the policy.

It’s important that you read the policy thoroughly to understand which specific conditions are covered. This is due to the fact that the policy will not cover all instances of a certain illness.

It’s common for customers to confuse critical illness cover with life insurance. They are two insurances that can be purchased together, however, what they cover is very different.

Examples of critical illnesses that might get covered include: 

  • Stroke 
  • Heart Attack 
  • Certain types and stages of cancer 

    Permanent disabilities resulting from injuries and other illnesses that are not stated might still be considered in the policy.

What isn’t covered? 

The following that might not be covered within the policy could include more severe forms of cancer and other conditions. Health problems you knew you had before you took out the insurance will probably not be covered. Furthermore, this type of insurance doesn’t payout if you pass away.

What will and won’t be covered will be stated in the policy details therefore make sure you understand the policy and check all the documentation protects your needs.

Other types of insurance you might need 

Other types of insurance can provide support should something unfortunate happen to you. Below, are a list of some you might want to look into:

Our Critical Illness Insurance Advice service in Cardiff

At Cardiffmoneyman, we offer all our customers a free, no-obligation protection review where we will look into any existing policies you have in place and check if they are appropriate for you. It’s important to know that insurance is massively beneficial.

Affordability is key when looking into insurance. That’s why a protection specialist in Cardiff, like ourselves, can provide you with the best cover that is suitable to your circumstances and priorities your budget and family.

Why Mortgage Protection Insurance is Helpful to Have in Cardiff

Mortgage protection insurance is a term used to encompass various types of cover designed to protect borrowers like first time buyers in Cardiff from events that could severely impact their ability to maintain mortgage payments. 

There are different variations, but when connected to a mortgage, they are all there to provide peace of mind and usually fall into the following categories: 

  • Life Cover 
  • Critical Illness Insurance 
  • Income Protection 
  • Family Income Benefit 

Life Cover 

As a rule, if the policyholder dies within the term, then the sum assured should be enough to pay off the outstanding mortgage balance and ensure the borrower’s dependents aren’t left with a debt they might not otherwise be able to manage.

How we can help you

Our protection specialists in Cardiff can run through all the different types of life cover and recommend the most suitable plan for you. 

Critical Illness Insurance 

Critical Illness Insurance works similarly to life insurance in that it is usually taken for a specific term of years and can have different options such as level/increasing. 

It pays out a lump sum, and, like life cover, it is taken on a decreasing term basis in line with the reduction of your mortgage balance for borrowers.  

The key is that the benefit is paid if you fall victim to one of several specified critical illnesses and pays out whatever the long-term prognosis of that illness. The type of illnesses covered vary from company to company. 

That’s why this type of insurance cannot be solely price-driven and always recommended advice. 

In practice, many companies will offer life and critical illness cover as a combined policy and would usually payout on the “first event”, i.e. whatever happens first – either death or a severe illness – the payout is made. They can also be written on a single or joint life basis. 

Income Protection 

Whereas life and Critical Illness cover pay out a lump sum, income protection pays out a monthly sum designed to replace your wages if you are unfit to work. 

Unlike critical Illness cover, there are no restrictions on the illnesses or injuries covered, the only factor being whether they make you unfit to work. 

However, there are restrictions on how much you can cover and how quickly benefits would start to be paid. 

Like life and critical Illness cover, these policies are underwritten based on your health and lifestyle when you apply. All income protection policies are written on a single life basis. 

Family Income Benefit 

Unlike the traditional forms of policy, the cover would pay an annual or monthly income for the remainder of the plan’s term rather than pay out a lump sum. 

Thus, it can replace the primary breadwinner’s income for several years, dependent upon a particular client’s circumstances and, because of this, would usually be written on a level or basis or an index-linked basis designed to keep up with inflation. 

Summary

There’s an adage that says you can never have too much insurance. Indeed, many people have one or more of the different types of policy, and it would be wrong to think of Mortgage Protection Insurance as just an “either/or” choice. 

However, affordability plays a massive part in the real world, so whilst it would be fantastic to cover yourself for every potential opportunity, a good advisor will sit down with you and tailor the type of cover to be the most suitable combination to your family’s priority and budget. 

Cardiffmoneyman.com & Cardiffmoneyman are trading styles of UK Moneyman Limited, which is authorised and regulated by the Financial Conduct Authority.
UK Moneyman Limited is authorised and regulated by the Financial Conduct Authority.
UK Moneyman Limited registered in England, registered number 6789312 and registered office 10 Consort Court, Hull, HU9 1PU.

© 2021 Cardiffmoneyman

Cardiffmoneyman, 4th Floor, 14 Museum Place, City centre, Cardiff, CF10 3BH.

Moneyman Logo







Moneyman Logo




Moneyman Logo

Ask Your Question





    Moneyman Logo

    Moneyman Logo







    Moneyman Logo

    Book your Free Consultation

    7 Days 8am - 10pm

    Moneyman Logo

    Moneyman Logo