If you happen to survive for more than 28 days from contracting on of the serious illnesses listed on your policy, then Critical illness insurance pays out, typically a tax-free lump sum (or a regular benefit in some cases). But, be warned, as these can make for a depressing read.
As set down by the Association of British insurers – ABI, there are seven core conditions which are covered by all insurance policies, these are:
- Cancer,
- Coronary artery bypass,
- Heart attack,
- Kidney failure,
- Major organ transplant,
- Multiple sclerosis and
- Stroke
In addition to the above, Critical illness insurance policy will also pay out if you are permanently disabled as a result of injury or illness.
The number and type of illnesses beyond these core conditions will depend on the individual policy so it’s crucial to read the terms and conditions carefully and know exactly what you are covered for prior to signing up. These are the areas where an Airborne Independent Financial Adviser can bring the wealth of knowledge and experience and help you choose the most suitable policy for you.
To ‘successfully’ claim against a critical illness policy your condition will have to meet some grim criteria, which will also be listed in the terms and conditions.
They may state for example that blindness should be ‘permanent and irreversible’, cancer excludes ‘advanced stages’ and that Parkinson’s disease should be ‘contracted before the age of 60’