Facing the unthinkable and preparing for the unexpected
In today’s unpredictable world, critical illness cover offers a vital financial safety net when you and your family need it most. Adding this option to your life insurance policy can alleviate the monetary burdens that may arise if you become critically ill.
While many people believe that critical illnesses won’t affect them, the reality is that such conditions can strike at any age. Investing in critical illness cover minimises financial strain during difficult times, allowing you and your loved ones to focus on what truly matters – recovery and support.
A helping hand in recovery
Receiving a diagnosis of a specified critical illness often requires taking time off work, and in some cases, individuals may be unable to return to their jobs. The financial implications can be overwhelming, from needing home adaptations to requiring specialised care, which can be costly.
Critical illness cover gives you the peace of mind to focus on healing, free from the stress of mounting expenses like mortgage payments, daily bills or groceries.
Safeguarding your family’s future
Surviving a severe illness should not lead to financial hardship. Although preparing for the worst is never pleasant, having a critical illness cover ensures you are ready for whatever life throws.
This preparation provides comfort, knowing that you have a plan to safeguard your family’s financial future even in the face of adversity.
Receiving a tax-free financial boost
Critical illness cover is designed to provide a tax-free lump sum upon the diagnosis of specific life-threatening or debilitating specified conditions such as heart attacks, strokes, certain cancers and multiple sclerosis.
This financial boost can be crucial in managing these illnesses’ immediate and ongoing costs.
Expanding your protection with a comprehensive policy
For broader coverage, consider a comprehensive critical illness policy. Such policies can include protection against conditions like loss of sight, permanent hearing loss, total and permanent disability preventing work, and even limb loss.
However, not all conditions are covered, making it essential to seek professional financial advice to choose the right policy for your needs.
Much-needed financial support
For singles without dependents, critical illness cover can offer a financial lifeline to pay off mortgages or provide a lump sum in case of severe illness.
Couples, too, can benefit from the monetary relief provided during emotionally challenging times.
Cover specifics and constraints
Each policy clearly outlines covered specific illnesses alongside any exclusions and limitations, which can vary among insurers. Most policies pay out only once and should not be considered income replacements.
Some insurers offer combined life and critical illness policies that pay out upon diagnosis of a specified critical illness or death, whichever comes first.
Considering pre- existing conditions
When considering replacing an existing critical illness policy, it’s crucial to be cautious about losing benefits if you’ve developed new illnesses since obtaining the initial policy.
Obtaining professional financial advice is vital before replacing or switching policies, as pre-existing conditions might not be covered in a new policy.
Adapting to life events
Specific policies permit increasing cover, especially following significant life events like marriage, relocating or having children. If your current policy doesn’t allow for increased coverage, consider acquiring a new policy to supplement your existing one.
Meeting defined criteria
Policies provide cover exclusively for conditions explicitly defined in the policy document, requiring your condition to match the policy definition precisely.
This stipulation may exclude certain conditions or those diagnosed past a certain age, such as Alzheimer’s disease, which is typically not covered if diagnosed after age 60.
Rethinking the survival period
Most critical illness policies include a ‘survival period’, meaning the insured must survive for a specified duration after diagnosis before the policy pays out.
If the individual passes away within this timeframe, no payout will be provided despite meeting the critical illness definition.
Factors influencing premiums
Various factors influence the cost of critical illness cover, such as the type of policy selected, the individual’s age, desired payout amount and smoking habits.
Inclusion of permanent total disability
Most policies incorporate permanent total disability cover, defined as an inability to work in one’s usual capacity due to illness or the inability to independently perform at least three ‘Activities of Daily Living’ due to sickness or injury.
These activities include bathing, dressing and undressing, eating and moving between bed and chair.
Ensure comprehensive protection
Advancements in medicine have increased survival rates for conditions that previously had higher mortality rates. Critical illness cover can offer financial support to pursue a less demanding lifestyle during recovery or be used for other purposes. Ensuring adequate coverage means not leaving your wellbeing to chance.
In conclusion, critical illness cover is essential to a financial planning strategy, providing security and peace of mind in the face of life’s uncertainties. By incorporating this cover into your financial plan, you can protect yourself and your loved ones against the unthinkable, allowing you to focus on recovery and maintaining your quality of life.