Critical Illness Cover and Life Insurance are two of the hottest topics in the UK right now, and More Than Money is here to answer the most frequently asked questions about these two very different, yet crucial types of insurance.
What Is The Difference Between Life Insurance and Critical Illness Cover?
Basically, one type of insurance financially benefits your family after you are gone, and the other one benefits you as well!
Life Insurance is undoubtedly the easiest and most selfless way to financially protect your family if the worst were to happen, paying out a tax-free lump sum to them if you die.
Critical Illness Cover ensures that you can still pay the bills and support your family if you were to become too ill to work, by paying out while you’re still alive.
With me so far?
Finding the right Life Insurance or Critical Illness policy for you is what we do best at More Than Money.
We take the time to listen to you and find out exactly what you want or need before going away and searching every UK insurer to find the most suitable policies to suit you.
Once you’re happy with everything and your Life Insurance policy or Critical Illness Cover ticks all the boxes, we’ll take you through the application stage.
This will include a health and lifestyle questionnaire, in order to set your policy up.
Next, we’ll answer any questions you may have, make sure the forms are completed correctly, and the Direct Debit for your monthly premiums is set up for your preferred date.
Finally, we’ll walk you through any forms that need signing, and make sure that all relevant documents are sent out.
It couldn’t be simpler!
Life and Critical Illness Insurance
Got some questions right now?
Read on! – we’ve probably got it covered…
Life Insurance And Critical Illness Cover Q&A
Is Critical Illness Cover The Same As Life Insurance? Absolutely not.
Life Insurance pays out a one-off, tax-free lump sum if you were to die during the term of your policy.
Normally your surviving family would use this to pay off the mortgage, cover any bills or debts, and cover funeral costs.
You might also want your Life Insurance to provide enough cover that you can continue to contribute towards expenses in your children’s future – a wedding or university costs, for example.
Critical Illness Cover pays out if you’re diagnosed with a serious illness, disability or medical condition.
You can use the money to support yourself financially, or adapt your home to your needs.
A good way to look at it is that Life Insurance benefits THEM, Critical Illness Cover benefits YOU.
How Much Does Life Insurance And Critical Illness Cover Cost?
How long is a piece of string?
It all depends on factors such as how old you are when you take out the policy, your current health and medical history, and how long you want the policy for.
There are also different types of policy, including joint policies with a partner, Term Life Insurance and Whole Of Life Insurance.
Your best bet when it comes to finding a policy that’s going to be the most beneficial to both your lifestyle and your wallet, is to come and speak to us and let us do the searching for you!
Does Everyone Need Life Insurance?
If you’re single and have no dependents, you might question why you need to bother with a Life Insurance policy.
And, to be honest, you don’t need to bother.
Life Insurance only pays out once you’re gone, so if there’s no one you want to leave money to, there’s no need to have a policy.
However, if you have children and/or a partner – or there’s anyone who relies on your income, and who would struggle financially without you, getting Life Insurance is a cheap way to solve that problem.
Do I Need Critical Illness Cover?
Yes, Critical Illness Cover is DEFINITELY worth having!
If you were to become seriously ill and couldn’t work, how would you pay the bills and support yourself?
And what about if you have a family? – some financial support if you suddenly couldn’t work because of a critical illness would certainly take a load off your mind, wouldn’t it? Especially if you’re the main breadwinner.
What Conditions Are Covered By Critical Illness Cover?
The list of conditions covered by Critical Illness Cover varies from provider to provider, with a lot of insurance companies including more than 60 different conditions.
As with all insurance policies, it’s really important to read the small print carefully to make sure you understand exactly what protection you have – and I can help with that!
How Much Should My Policy Cover Me For?
As a general rule I would recommend that you cover roughly 10 times the main breadwinner’s income in order to cover the mortgage, any debts, funeral costs, and day-to-day living.
Ten times your income might seem excessive, but don’t forget that with the rate of inflation the value of that payout will be worth less in the future than it is now.
These are some of the most common questions I get asked about Life Insurance and Critical Illness Cover, but it’s definitely not an exhaustive list!
If you have any questions about Life Insurance or Critical Illness Cover, or you want help finding the best policy for you, drop us a line and we’d be happy to help. We are always happy to chat face to face so why not book to come into our Ashford branch and speak with me directly.