Finance Life Insurance

Many people mistakenly assume that if they contract a medical condition they will not be covered by their life insurance, but that’s not necessarily the case. It is possible to obtain high-risk policies that take into account various health factors and risks. These policies are called critical illness insurance policies.

The most common way of ensuring that your life insurance policy will cover you, should you contract a medical condition, is to add critical illness cover as an additional option. Although it will put added cost onto your existing premium payments, critical illness cover ensures that you are provided with financial security in the event that you are diagnosed with a critical illness during the term of your policy. There are now seven core conditions that all critical illness policies should cover; they are, heart attack, cancer, multiple sclerosis, kidney failure, coronary artery bypass, major organ transplant and stroke. The insurance company should also pay out if you become permanently disabled as a result of injury or illness.

Whereas a normal life insurance policy would pay out to your beneficiaries only in the event of your death, a critical illness life insurance policy would ensure that your insurer pays a tax-free sum directly to you (usually monthly). This would enable you to pay for extra medical treatment and cover your loss of earnings, should you be unfortunate enough to be diagnosed with a critical illness.

Whether you decide to apply for critical illness cover or not will depend on a variety of circumstances. If you have a family and you are the principle earner, you would want to protect them should the unthinkable happen. For example, if you were to have a heart attack, which rendered you unable to work for an extended period of time and you had previously taken out critical illness cover, you would be eligible for a tax-free lump sum payment to pay your family’s ongoing living expenses.

If you have a mortgage to pay, you can also take out a mortgage protection policy that incorporates critical illness cover.  This removes the threat of being evicted from your home if you were unable to work for a protracted period due to illness.

Before you decide that you’re still young and fit and don’t need to pay for critical illness cover on your life insurance policy, it’s worth noting that in the UK today, one in four women and one in five men will contract a serious illness, such as cancer or heart disease before retirement age.

When you are researching which policy is right for you, it’s very important to obtain a number of life insurance quotes from several companies in order to make a meaningful comparison between each one. It’s also very important that you’re honest about your medical history. Each life insurance quote you receive will contain slightly different terms and conditions, as well as differing in price. If you’re still unsure which policy is the right one for you, it’s always worth consulting a life insurance professional for help and advice.