Most policies combine life and critical illness cover, paying out whichever happens first; Death or critical illness.



Illnesses covered

To call itself critical illness a policy must follow guidelines and offer the minimum of the following.

Cancer - advanced cases

Heart attack - if adequately severe

Stroke - resulting in permanent symptoms

However, the majority of policies cover more than these three. Kidney failure, major organ transplants, multiple sclerosis and bypass surgery are typically covered in basic plans.

Permanent loss of hearing and sight and permanent disabilities, that prevent you working, are covered in comprehensive plans. Some cover against loss of a limb.

Not covered

Conditions are only covered if they meet exactly with the policies definition. If a condition is classed as insufficiently severe, such as some types of cancer, it will not be covered.

Likewise, after reaching a certain age, many policies do not cover certain conditions. Many will not cover Alzheimer's if diagnosed after 60.

Additionally, many policies do not cover:

Injuries, self-inflicted

Alcohol or drug abuse

Flying - besides normal passenger flights

Participating in hazardous sports and pastimes

HIV- and Aids-related illnesses - unless caught from a blood transfusion, through physical assault or at work in the emergency services, medical profession or armed forces

Not following medical advice

War, rioting or civil commotion

Most policies pay out after a “survival period” of normally 28 days, not on diagnosis. If you die within 28 days of meeting the policies criteria, no payment will be made.

Where to buy critical illness insurance

An independent adviser or broker would advise you best on buying critical illness insurance as policies vary so much. They would be able to advise you which policy is best suited to your needs.

They will also advise how much cover and for how long you need it and if critical illness and life cover combined would be beneficial.

No policy will pay out if you already suffered from a critical illness when you purchased the cover. It may be the same if you previously visited your GP regarding a problem that turned out to be critical.

When applying for insurance it is imperative that you answer all questions accurately. “Material facts” that are not disclosed could result in claims been refused.

Premiums

Premiums vary depending on a number of factors, such as policy chosen, age, the amount you want the policy to pay out and if you smoke.

Putting in a claim

Always follow the policies guidelines, if you make a claim. The policy, for example, may need diagnosis from a UK specialist who specialises in medicine associated with your illness. A GPs diagnosis may not be enough.

Your claim will be rejected if your condition does not meet any definitions listed in your policy.

Alternatives

Income protection insurance is sometimes a better option for some. If, as a result of an accident or illness (not necessarily critical) you cannot work then you will receive a tax-free income.