Critical illness cover is different to life insurance in that it will pay out during your lifetime. This means you yourself will reap the benefits of your forward planning and you will be able to decide how the money is used. But there is a myth going around that it is not possible to get critical illness cover for the same cheap rates that are available for life insurance.
The first thing to do is to remember what critical illness cover is for. It is to provide a financial buffer for you whilst you recover from your serious illness. It is to allow you to concentrate on getting better, instead of worrying about money. Depending on your circumstances, this can involve making repayments on your mortgage and paying household bills, or it can be used for the benefit of your business if you are self-employed. As the aim is not to pay off your mortgage entirely, or to fund a round the world cruise (unless that’s what you really want!), you can opt for a smaller sum assured than you might have chosen for your life insurance policy.
The other key point to remember is that you are much more likely to claim on your critical illness cover than you are on a life insurance policy. So whilst you may not be able to get critical illness cover as cheaply as you might like, its value to you and your family is that much greater because you are much more likely to use it.
Once you have your policy, it is always worth having a close look at your policy documents. Every insurer includes different serious illnesses in their cover, and some will include a possibility for partial payment for certain illnesses. With most insurers, partial payment will not affect your cover and you will still be able to make a claim on the full amount of cover further down the line. Most insurers also offer partial payment if your children are diagnosed with a serious illness. Your child getting ill is probably not something you want to think about, but if you did, you would probably think a bit of extra money would help to buffer the time off work for example.
Recovery from critical illness varies between people and between illnesses, but can often be measured in a matter of months as opposed to years. Therefore the amount of cover does not necessarily need to be much more than your annual salary and can even be less. This means you can add some valuable critical illness cover to your life insurance policy without too much added cost.