Critical Illness Insurance: Do You Need It?

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Critical Illness Insurance: Do You Need It?

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Do you ever stop and consider what would happen if you were suddenly found to have a severe illness like cancer? Would you be financially prepared to handle the expenses that come with it? While it's never nice to think about, serious illnesses can occur at any time, regardless of how young or healthy you may be.

In which case, it's worth looking into protection. Critical illness, in particular, can help ease the burden that illness/disability can produce. We'll look at how it works and some factors that make it a must-have.

What is critical illness insurance?

Critical illness insurance is a type of insurance that provides a lump sum payment if you are diagnosed with a serious illness. It's different to health insurance, for example, which can help cover the cost of medical treatment.

Whereas critical illness cover can provide financial support to help you and your family while you are unable to work. It can pay out a cash lump sum if you suffer from an illness such as:

  • Cancer (specific types)
  • Heart attack
  • Stroke
  • Organ failure
  • Multiple Sclerosis
  • Major organ transplant
  • Parkinson's disease

It differs to terminal illness cover, which is for illnesses that are incurable, and you have less than 12 months to live.

Who needs critical illness cover?

The truth is that anyone can benefit from having this type of protection. But ideally, you may want to consider buying a policy if:

  • You or your dependents heavily rely on your income
  • You have a mortgage or other debts that would be difficult to pay off without your income
  • Your employee benefits package doesn't cover time off for long periods of sickness.

So why else would you need this type of cover? Here are some reasons why:

Health History

Do you have a history of illness in your family? Or do you yourself have any pre-existing medical conditions? These are all factors to take into account when deciding on critical illness cover.

Even if you're young and healthy now, who knows what could happen in the future. None of us can predict when we might be faced with a sudden illness, so having that extra layer of protection can provide peace of mind for you and your loved ones.

Financial Situation

Another reason to consider critical illness cover is the financial security it can provide. A serious illness diagnosis can come with a hefty price tag, from medical bills to ongoing treatment costs. If you were unable to work during this time, how would you cover your expenses and support your family?

Critical illness insurance can provide a lump sum which you can use however you see fit. Whether it's paying for medical treatments, covering household bills, or even taking care of childcare costs while you focus on your recovery, this money can help alleviate some of the financial stress that comes with a serious illness.

Long term goals

It's a sad thought, but a serious illness can have a major impact on your long-term financial goals. Without the right cover in place, you may be forced to dip into savings or retirement funds to cover expenses. A potential setback for future plans.

But with cover in place, it could help protect any savings or retirement funds you've worked hard to build up. That way, you can focus on your recovery and not worry about how you'll handle the financial burden.

Existing insurance cover

Take a look at your existing insurance cover, including health insurance and life insurance. While these policies may help cover some of the costs associated with a terminal illness, they may not provide the comprehensive financial support that critical illness insurance does. Having a combination of insurance policies can provide you with greater cover and peace of mind.

Some insurances may even offer critical illness as an optional add-on to your existing policy. So it's worth checking with your current provider to see if this is an option for you.

Critical illness insurance may not be needed for most. That said, it can provide valuable financial protection in the event of a serious illness. Ultimately, your decision should be based on your individual needs and circumstances.

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Critical Illness Insurance: Do You Need It?

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