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critical illnessCritical Illness Insurance

Below you can find the answers to questions you may have about Critical Illness.

  1. What is Critical Illness Insurance?
  2. How much Critical Illness Insurance do I need?
  3. Do I need Life Insurance?
  4. Where do I find the Small Print?
  5. Which life insurance policy should I choose?
  6. Where do I buy life insurance?
  7. Why do different people pay different levels of premiums?
  8. Can I take life insurance out for someone else?
  9. How Do I Save Money On My Premium?
  10. What Other Definitions/Types of Life Insurance Are There?

Life Insurance

  1. Q. What is Critical Illness Insurance?

    A. Critical Illness Insurance pays a tax-free lump sum on diagnosis of any one of a list of serious illnesses – including cancer and heart attacks and strokes. Claims statistics suggest you are five times more likely to suffer from one of these than you are to die before you reach 65.


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  2. Q. How much Critical Illness Insurance do I need?

    A. You are the best person to know how much Critical Illness Insurance you require, or alternatively you can contact one of our fully qualified advisers. It is quite common for people to cover their mortgage with Critical Illness Insurance or to provide a lump sum for personal expenditure e.g. to fund a period of convalescence or a holiday of a lifetime.

    If you feel it is not affordable to cover your mortgage then we recommend that you consider covering a percentage of your mortgage. By doing this you will have the peace of mind of knowing that you have sufficient funds which you can choose to use for mortgage payments, bills, specialist private medical care or to make adaptations to you home if required.


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  3. Q. Do I need Life Insurance?

    A. It depends if you want or need that security. By definition the benefits of the types of Life Insurance are self explanatory but they will require investment from you. Is it something you really need? Think what your level of priority is. For many Life Insurance is an important commitment to their family but you have to be able to afford it. If you do require life insurance you should consult with a specialist life insurance advisor. Also seek advice from friends and family.


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  4. Q. Where do I find the Small Print?

    A. When you buy Life Insurance you will receive a Policy Document which sets out the full terms and conditions of your policy and also a Policy Handbook containing background information and explanations about your life insurance. As with any legal contract ensure you have read and understood these details fully. Check any terms and weigh up the quality of what is actually on offer against what you are paying out. Check carefully for additional clauses for events that are extremely unlikely. Make sure you know what you are paying for. Never buy more cover than you need.


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  5. Which life insurance policy should I choose?

    A. You need to check your budget and think carefully what your needs are. There are a great deal of different policies to suit everyone’s needs. Speak to your independent financial advisor if in doubt. Remember, one of the main options is Term Insurance which provides a payout if you die during the term of the contract. You can take this out for the period of your mortgage to relieve dependents of any unexpected burden. You can also take it out just for the period when your children are financially dependent upon you. Life Assurance offers a payout if you die but there is also a payout if you survive the term. It can be an important alternative investment opportunity. It can also give you the peace of mind of helping to safeguard for your retirement.


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  6. Q. Where do I buy life insurance?

    A. There are many reputable high street lenders. Many in the UK are household names. Always consider the history of the company and their perceived reliability before obtaining a quote. Always get different quotes. Four or five is a good number to aim for. Also, beware of taking out a policy with your mortgage provider. Alternative providers will probably offer better deals. Online savings may be possible but remember price is not everything. Proceed with caution. High Street brands may offer greater reliability.


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  7. Q. Why do different people pay different levels of premiums?

    A. The amount you pay depends on the level of risk you provide to your lender. The price you pay for life insurance depends mainly on your age, your health and your lifestyle and occupation. So if you are older, you have health problems, and you are a smoker and you work in a dangerous environment you will always pay more for life insurance than someone who is younger, healthier, a non-smoker in a low risk occupation.


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  8. Q. Can I take life insurance out for someone else?

    A. Yes. There are three parties in a life insurance transaction: the insurer, the insured, and the policy holder. The owner and the insured are usually the same person but not always. The beneficiary is the person or persons who will receive the policy proceeds upon the death of the insured. Although it is typical for an individual to name his or her spouse or other relative as the life insurance beneficiary non-relatives can also be named.


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  9. Q. How Do I Save Money On My Premium?

    A. There are many ways to save money on your premiums – these are just some of them 

    • Shop Around Obtain different quotes. Use price comparison guides on the internet to get you started.
    • Work It Out Work out the level of coverage you get, say, per £1,000 investment, and compare all the quotes carefully.
    • Find Specialist Insurers You may find insurers who offer competitive benefits and will assess you as an individual rather than asking a few stock questions, particular if you have a health problem.
    • Quit Smoking And Keep Fit You can make massive savings if you lose weight or pack in smoking. The healthier you are the cheaper your premium will be.
    • Pay up front A one off payment could save you lots of money if you can afford it. Compare the total cost of monthly payments with a one off fee. It may be cheaper to arrange a loan with better conditions and pay up front than pay a monthly payment.
    • Buy Sooner Rather Than Later The younger you are when you purchase life insurance the cheaper your premium will be.
    • Always use comparison quote tools Compare leading insurance quotes at the click of a button and save time and money.


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  10. Q. What Other Definitions/Types of Life Insurance Are There?

    • Temporary Life Insurance Another name for term insurance. A defined time period decided upon when the contract is drawn up.
    • Permanent Permanent life insurance is life insurance that remains in force until the policy pays out or the owner fails to pay the premium. A permanent policy cannot be cancelled by the insurer.
    • Limited-pay Another type of permanent insurance is Limited-pay life insurance in which all the premiums are paid over a specified period after which no additional premiums are due to keep the policy in force.
    • Endowments Endowments are policies where the cash value build up inside the policy equals the death benefit at a certain age. Endowments are expensive but endowment Insurance is paid out whether the insured lives or dies, after a specific period.
    • Accidental death Accidental death is a limited life insurance designed to cover the insured when they die in an accident. Because they only cover accidents these policies are much less expensive than other life insurances.
    • Group Life Policies Group life insurance is a life insurance policy in which a single contract covers an entire group of people. Group life policies do not always relate to schemes established by an employer for the benefit of employees but quite commonly are part of an employment package.
    • Critical Illness Insurance You receive a lump sum on the diagnosis of certain life-threatening illnesses specified in the policy.
    • Fatal Accident Benefit Certain life policies will make an additional payment – over and above the sum insured – if the policyholder dies as a result of an accident.


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