Being hit by a Critical Illness is a devastating blow
and can be very hard to cope with both emotionally and
in many other ways.
last thing which is needed in such a dreadful situation
is the added problem of how to cope financially.
Critical Illness Cover (CIC) can provide an answer but
CIC-policies are not always straightforward to
understand or interpret!
Cover (CIC) - the essentials
Critical Illness Cover (CIC)
is designed to pay out a tax-free lump sum in the event of you
suffering from certain types of serious illness or if you have
to undergo surgery.
It is very important that you
note the phrase: ‘suffering from certain types of
serious illness…’. Far from all illnesses are covered by
standard CIC-policies, so, should you be so unlucky and be hit
by one which is not on your ‘approved’ list, the policy will pay
out absolutely nothing!
The policy will pay out though,
if you contract one of a defined list of illnesses specified in
your policy. These policies differ in what they cover, so you
should always check the policy wording very carefully or discuss
the matter with a suitable professional.
Who may need CIC?
Unless you have substantial
savings, some form of critical illness insurance may well make
sense for you, particularly if you have outstanding debt such as
e.g. a mortgage.
The level of cover you should
have will obviously depend on your individual circumstances but
may be larger than you think.
The size of your premium will
depend on your age, gender, health, occupation, whether or not
you smoke, the type of cover you need, and how long you need it
It is important to remember that
premiums could also be more expensive if there is a history of a
particular illness running in your family.
Usually you will pay a set
premium meaning that both your cover and your premium will be
set at a certain level for a certain period of time.
It should be noted that there are
also whole of life assurance policies which include critical
illness cover and may offer more flexibility such as the option
to changing your cover over time.
Total And Permanent Disability
Many critical illness policies
also include cover for total and permanent disability.
This pays out if you are unable
to work due to permanent disability arising from any illness or
injury. If such cover is included, it is important to establish
whether the policy will cover ‘any occupation’ or only ‘own
There has been horror stories of
people believing that they were covered by disability cover only
to discover that, according to the insurance company, the loss
of a few limbs and eye-sight certainly does not prevent you from
rejoining the active work-force!
Your protection adviser at NFA
has a Ph.D. and over 25 years of experience in biomedical
research and will be able to ensure that you are not misled by
incomprehensible medical jargon.