Critical Illness

I want to make sure I can pay off my mortgage and my family are secure if I become critically ill

Critical illness insurance offers you and your loved one’s financial support should you unexpectedly fall ill with a specified illness. It pays out a tax-free lump sum if you're diagnosed with, or undergo surgery for, a critical illness that meets the policy definition during the policy term and survive a specified period.

Critical illnesses are identified under a specific set of criteria under the Association of British Insurers (ABI) ‘Guide to Minimum Standards for Critical Illness Cover’.

Minimum standards

In the unfortunate event that you were to develop a critical illness that is addressed in the ABI ‘Guide to Minimum Standards for Critical Illness Cover’ as a result of coronavirus, the majority of insurers would be expected to approach this claim in the same way as they would usually. Think about the costs you'd need to cover if you were to fall ill and couldn't work, this might include regular outgoings, such as energy bills and food shopping.

Mortgage applications

If you have children, you’ll want to ensure that your family is provided for, in case you can’t work due to health problems. Level cover can offer financial security for you and your loved ones. Or you may need a policy to make sure that your mortgage can be paid off — this is often a requirement of mortgage applications. Decreasing cover helps to pay off debt, like a repayment mortgage, that's reducing over time.

Back-up plan

A critical illness can affect anyone at any age and can turn lives upside down. In the event of being unable to work due to critical illness, having a back-up plan in place can alleviate some of the financial stress of the situation.

Some people may use their savings to supplement their loss of income, others may rely on an employment benefit package, while others may find that opting for critical illness insurance is their best option.