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  • FIRST POST
    • molit
    • By molit 9th Oct 17, 12:57 PM
    • 366Posts
    • 347Thanks
    molit
    Critical illness cover
    • #1
    • 9th Oct 17, 12:57 PM
    Critical illness cover 9th Oct 17 at 12:57 PM
    Hi

    I have no dependants, but have been wondering about critical illness cover recently. I think at work I get 3 months paid sick leave, but other than that I have nothing. I have an emergency fund, but wondered whether other people go for it, and also, if it does pay out?

    Mo
    No longer an accidental landlord, still a wannabe millionaire
Page 1
    • dunstonh
    • By dunstonh 9th Oct 17, 1:20 PM
    • 89,840 Posts
    • 56,490 Thanks
    dunstonh
    • #2
    • 9th Oct 17, 1:20 PM
    • #2
    • 9th Oct 17, 1:20 PM
    and also, if it does pay out?
    Most CIC policies report payouts on over 95% of claims made.

    In the pecking order, it tends to fall below permanent health insurance (PHI for short - the best form of income protection). PHI is not specific to critical illnesses and replaces income rather than provide a lump sum.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • YHM
    • By YHM 9th Oct 17, 2:50 PM
    • 299 Posts
    • 97 Thanks
    YHM
    • #3
    • 9th Oct 17, 2:50 PM
    • #3
    • 9th Oct 17, 2:50 PM
    Critical Illness is a fantastic policy in terms of its intent, however, many people mistrust it as they either think they are untouchable and will never suffer said critical illness or see it as some form of exploitative game by insurers to not pay out on a claim. I can assure you neither of these are true.

    Comparatively it isn't cheap against life insurance, but this is due to the likelihood you are to need to claim on the policy.

    If you have a mortgage liability which is solely reliant on your income, it is an essential part of your protection toolbox.
    I am a Mortgage Broker.

    You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice
    • Chris Pollard
    • By Chris Pollard 9th Oct 17, 3:44 PM
    • 87 Posts
    • 33 Thanks
    Chris Pollard
    • #4
    • 9th Oct 17, 3:44 PM
    • #4
    • 9th Oct 17, 3:44 PM
    molit - Does it pay out? Yes. go onto every main insurer's website and you will see the overwhelming majority of claims are paid. As dunstonh says, disability cover should come first. If you suffer from an injury or illness that is not covered by CIC (for example a musculoskeletal or mental health problem) you may be unable to work but you would not have a CI pay-out. If you go onto LV's website and check out the "risk reality" calculator it will tell you the likelihood of you dying, suffering a serious illness or being off work for more than two months. 80%+ of CI claims come from cancer, heart attacks and strokes. However, the majority of income protection (IP or PHI as above poster refers to it) are from musculo-skeletal and mental health.

    If the budget allows buy both IP and CI. You can tailor the waiting period before the IP benefits are paid (you say you would be paid for three months so that seems a logical waiting period). Work out how much income you need (when in claim the benefits do not attract income tax or NI) to cover essential bills, rent, mortgage etc. If you've still got some budget left over then by all means take out some CI. You'll find almost every insurer will also include "life" cover with all CI policies.

    Best of all speak to a broker/financial adviser - particularly for IP as whilst it isn't rocket science, there are quite a few things to consider.

    Good luck
    • Linz2449
    • By Linz2449 23rd Oct 17, 12:29 AM
    • 4 Posts
    • 1 Thanks
    Linz2449
    • #5
    • 23rd Oct 17, 12:29 AM
    Yes they do
    • #5
    • 23rd Oct 17, 12:29 AM
    Hi. In my experience yes they do. My partner has MS and my brothers partner has breast cancer and both policies paid out with little fuss. There are specific illnesses they cover and I know some are more specific than others but I had no issues. You never think you will need it, but you don't expect to be diagnosed with MS at 38 and cancer at 40. You never know what's round the corner. Hopefully you will never need it though. Good luck and good health
    • FIRSTTIMER
    • By FIRSTTIMER 24th Oct 17, 6:55 PM
    • 268 Posts
    • 52 Thanks
    FIRSTTIMER
    • #6
    • 24th Oct 17, 6:55 PM
    • #6
    • 24th Oct 17, 6:55 PM
    I am practically in the same situation as you....I think I am going to pluck for both.


    £150k life and cic is costing me guaranteed £370 a year until 70
    £1500 IP is costing me £46 a month until 70.


    I think 900 a year is what I want to pay at age 35 until 70 versus problem at 50 and no money to fix it.
    Savings £10000
    • YHM
    • By YHM 24th Oct 17, 8:55 PM
    • 299 Posts
    • 97 Thanks
    YHM
    • #7
    • 24th Oct 17, 8:55 PM
    • #7
    • 24th Oct 17, 8:55 PM
    Have you received advice on the above?
    I am a Mortgage Broker.

    You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice
    • FIRSTTIMER
    • By FIRSTTIMER 24th Oct 17, 9:04 PM
    • 268 Posts
    • 52 Thanks
    FIRSTTIMER
    • #8
    • 24th Oct 17, 9:04 PM
    • #8
    • 24th Oct 17, 9:04 PM
    only from lifesearch/Cavendish and dewsberry - they all say the same things
    Savings £10000
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