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Critical Illness Cover Advice
Taking out a mortgage? You may not always need a critical illness cover policy, but it is certainly advisable to have one.
What Is Critical Illness Cover?
Put simply, critical illness cover is an insurance policy that pays out if you’re diagnosed with a serious condition listed on the policy. It’s designed to ease the financial pressure and help ensure you can keep up with your mortgage and other commitments if you’re unable to work.
If you’re a first-time buyer, this can be especially important, as your financial position is often more stretched in the early years of a mortgage.
Unlike life insurance, which pays out upon death, critical illness cover supports you while you’re still alive but unable to work due to a serious diagnosis. It helps you and your family stay financially stable while your focus is on recovery.
Policies vary, and understanding exactly which conditions are covered is an important part of choosing the right policy. The majority of claims (around 65% according to the Association of British Insurers) relate to cancer, but cover can also include conditions such as heart attack, stroke, multiple sclerosis, Parkinson’s disease, motor neurone disease, and organ failure.
Getting the right critical illness cover in place is an important part of your overall financial planning. It can be difficult to navigate the detail and policy differences, which is why many people choose to get independent advice. This is often done alongside arranging a mortgage, as the two go hand in hand
Why Critical Illness Cover Matters for Homeowners
Arranging your mortgage and critical illness cover at the same time is one of the most effective ways to protect yourself financially. It helps ensure that if something unexpected happens, you’re still able to keep up with your mortgage payments.
No one likes to think about worst-case scenarios, but planning ahead is essential. A serious illness can affect your ability to work and maintain your income, which can quickly put pressure on your finances. Having the right cover in place helps reduce that risk and provides reassurance that your home is protected.
It’s important to understand that critical illness cover is separate from other types of protection such as life insurance. While life insurance pays out on death, critical illness cover is designed to support you while you’re still alive but unable to work due to a serious condition.
In many cases, policyholders use the payout to help reduce or clear their mortgage, as well as cover day-to-day living costs during recovery.
What’s Covered by Critical Illness Insurance?
Critical illness insurance cover policies vary, so it’s important to spend time understanding the details of any offer before signing on the dotted line. There is help available even if you already have a medical condition, so it’s always worth asking if critical illness cover for pre-existing conditions is available from your chosen provider.
Most insurers include cover for:
Cancer
Heart Attack
Stroke
Multiple Sclerosis
Major Organ Transplant
Parkinson's Disease
Alzheimer’s disease or dementia (before a certain age)
Blindness or deafness
Permanent disability
The market however, is crowded with a wide range of policies, all offering different levels of cover. It can be difficult to know which option is right for your situation.
Without the right protection in place, even a short period off work can have a significant impact on your ability to keep up with your mortgage and household costs.
This is where an experienced, independent advisor can make a real difference. A standard, off-the-shelf policy won’t always be suitable, so it’s important to choose cover that’s tailored to your individual needs.
Life Insurance vs Critical Illness Cover – or Both?
Life cover and critical illness insurance can seem similar, and it’s common to question which is more important. In reality, they both play an important role in protecting your finances and keeping your home and family secure.
The two products differ in their purpose. Life insurance pays out on death or, in some cases, a terminal diagnosis, helping to support the people you leave behind. Critical illness cover on the other hand, provides a payout if you’re diagnosed with a serious condition, helping you manage financially while you’re still alive.. but unable to work.
Many homeowners choose to put both in place. This provides a more complete level of protection and peace of mind, knowing that whether something happens to you or affects your ability to work, your mortgage and household costs can still be covered.
You may also see critical illness cover referred to as:
- Critical life insurance
- Serious illness cover
- Life and critical illness cover
- Mortgage illness cover
- Illness protection
Regardless of the name, the purpose is the same: to provide financial protection if you suffer a serious illness.
Get a Personalised Quote from a Trusted Advisor
I’m Ian Smith, an independent mortgage and protection adviser based in Essex. With access to the whole of the market, I compare providers to find the most suitable critical illness cover for your needs and budget.
I can also arrange combined life insurance and critical illness cover, helping you put the right protection in place alongside your mortgage. My priority is always to find the most appropriate cover for your home, your family, and your overall financial position.
Frequently Asked Questions
Is critical illness insurance the same as life insurance?
No. Life insurance pays out upon death. Critical illness pays out while you’re alive and suffering from a serious health condition.
Can I get critical illness cover with a pre-existing condition?
Yes, but it is sometimes a more complex process if you have a medical history. It’s advisable to get independent expert advice to get the best offer.
Does critical illness insurance cover cancer?
Most policies cover certain types and stages of cancer, but not all. I can guide you through the definitions and help you choose a plan that suits your concerns.
Can I claim more than once?
Some policies allow multiple claims for different conditions. Others pay out once. We’ll go over this during your consultation.
How long does the cover last?
You can choose a term that suits your needs – for example, until your mortgage ends or your children are financially independent.
Can I get critical illness cover if I’m self-employed?
Yes. In fact, it’s more important to protect your income if you’re your own boss. Talk to me about self-employed options and how you can protect your home and family.
Can I do without critical illness cover?
In theory, you can, but it feels like an unnecessary risk. A critical illness policy helps prevent your home from being at risk if you fall ill and can’t work. Could you cope without it?
Ready to Discuss Your Options?
Click the Book an Appointment tab or call me on 01708 535 946.
Let’s make sure you and your family are protected, no matter what comes your way.