Life Insurance And Critical Illness

rwknott

Hello

I was looking for some advice on Life Insurance And Critical Illness. I have just bought a house with my partner and I was wonder what would be the best cover.
I have a mortgage over 25years on a repayment basis. My self and my partner both work in education so we get 6 months full pay sickness then 6 months half pay sickness.
Is the Critical Illness cover a waste of time?
Any help would be great, also if you know of a good company to go with.
Thanks
Rob

dunstonh

I was wonder what would be the best cover.
..
also if you know of a good company to go with.

Best in what way? Best in level of cover, best in claims payout rates etc

_Andy_

rwknott wrote: »

Hello

I was looking for some advice on Life Insurance And Critical Illness. I have just bought a house with my partner and I was wonder what would be the best cover.
I have a mortgage over 25years on a repayment basis. My self and my partner both work in education so we get 6 months full pay sickness then 6 months half pay sickness.
Is the Critical Illness cover a waste of time?
Any help would be great, also if you know of a good company to go with.
Thanks
Rob

Hi Rob
I think you've confused what critical illness cover does. It doesn't pay a monthly benefit so really your sick pay isn't that relevant.
It pays a lump sum in the event of things like cancer, heart attack, stroke, etc...
Having seen someone close to me affected and not having CI cover and them subsequently having to spend their life savings converting their house and cover care and equipment costs I'd say is definetely a good thing.

Life assurance pays out a lump sum if you die, although you can build CI cover in so that it pays out on either.

What you may be mentioning though is some form of income protection or payment protection policy which would pay out a monthly benefit due to illness etc.

Wutang_2

Can we start a poll on whether the poster should speak to an IFA?

and another poll on whether they are thinking of PHI?

DW123_2

Critical Illness- it's a sham...particularly if you survive or cannot work again. If you die from a terminal illness you have a chance but you might have been better getting a life assurance/insurance policy instead of critical illness.

They will find any excuse not to pay even when confronted with overwhelming evidence which you have to provide at your cost. It's not in their interest to pay for tests that will be used against them.
They know that you obviously work so can't have legal aid and to take them to Court would cost £50k. Who would take a gamble on that??? They rely on you going to the Finacial Ombudsman who is not entirely impartial.

My advice....keep your money in the bank.

dunstonh

Critical Illness- it's a sham...particularly if you survive or cannot work again.

Its not a sham. Whether you work again or not doesnt matter and you have to survive and that is the point of it.

If you die from a terminal illness you have a chance

Terminal illness is different to critical illness. Indeed, a decent policy could pay out twice if you become critically ill but survive the qualifying period but then die after that.

you might have been better getting a life assurance/insurance policy instead of critical illness.

Statistically correct. The stats are 1 in 5 men will die before retirement. For critical illness its 1 in 6 will suffer a claimable event before retirement. So, if you want to play the odds game, then death is more likely than a critical illness... just.

They will find any excuse not to pay even when confronted with overwhelming evidence which you have to provide at your cost.

Thats a media driven myth. Most companies average around 85% of claims being paid out. 10% for something not being covered and 5% for non-disclosure. Norwich Union posted their claims stats recently and it was in the high 90% range for paying out.

They rely on you going to the Finacial Ombudsman who is not entirely impartial.

Any chance you have a chip on your shoulder about this?

My advice....keep your money in the bank.

I'm sure all those that have had critical illnesses and had payouts would not agree with you one bit. When you consider what rubbish people insure themselves for, CI is not actually bad value for money. Especially if purchased young enough to get a decent level of cover for their working life. Problem is that many leave it until they are older and more likely to claim only to find it very expensive. That said, my youngest claiment was 26. I had a 31 year old claim last year but most people that claim seem to be in their late 30s or early 40s based on my experience. I also seem to handle more CI claims than life assurance claims over recent years and that is something that other advisers have mentioned as well.

If you dont like the insurance then you dont have to take it but spreading myths and misinformation doesnt really do anyone any good.

dodgyeyes

I agree - critical illness definitely not a sham. Had to claim myself 4 years ago - was difficult to as insurance company claiming non-disclosure - but had excellent service from ombudsman and won our case. Now in a position where we will always have a roof over our head as paid lump sum off mortgage. Lucky enough to also have income protection so am paid a monthly salary now until retirement.

Can never predict illness - occurs out of the blue in many cases. Definitely consider.

dunstonh

but had excellent service from ombudsman and won our case.

The FOS have been very good on this. They created a set of rules regarding non-disclosure a few years back and published them. The insurance companies then knew exactly how the FOS will react and were able to set their responses accordingly. This is why non-disclosure issues are far less common nowadays. I think yours would have been just before those were introduced but its possible that your case would have been one that was used in their stats and information in creating those rules.

DW123_2

dunstonh - SORRY BUT you don't know what you're talking about!!

Whether you work again or not doesnt matter and you have to survive and that is the point of it.

• You need to survive for a certain length of time depending on the policy wording. There are 30 or so critical illnesses listed the most onerous is the Totally & Permamently Disabled part. This is where the work again or not is relevant. IMO, you need to be quadraplegic (although it doesn't say that) to succeed in a claim. Otherwise you don't stand a chance.

Terminal illness is different to critical illness. Indeed, a decent policy could pay out twice if you become critically ill but survive the qualifying period but then die after that.

• I agree it is different. But any terminal illness is also a critical illness in most policies. By the way how do you know a decent poicy until you make a claim???

Thats a media driven myth. Most companies average around 85% of claims being paid out. 10% for something not being covered and 5% for non-disclosure. Norwich Union posted their claims stats recently and it was in the high 90% range for paying out.

• Absolute tosh!!! A relative was refused payment on the grounds that seeing a chirporctor is the same as seeing a doctor. They answered no on the medical report to having seen a consultant/doctor within the timescale that was asked even though they had seen a chiropractor privately.
• More absolute tosh!!! A friend developed an illness which means they cannot walk without crutches. It won't be long before a wheelchair becomes a permanent addition to their life. The insurance company wrote to a specialist and GP who both say this person will not work again. Because the evidence wasn't in their favour they refused to accept it saying both were advocates for the claimant!!!!

I note you are an IFA with an interest in setting these traps up. You get your commission and the claimant gets F#@l all. I hope the insurance companies all go bust as result of the credit crunch.

dunstonh

dunstonh - SORRY BUT you don't know what you're talking about!!

Given your earlier post and the one above its clear you do not. There is little point in engaging in any further discussion with you as I fear your chip is going to get the way.

feisty1

DW123: quote: "dunstonh - SORRY BUT you don't know what you're talking about!!............somehow I think have got this wrong

I don't know where u have rcvd yr information from sady yr wrongly informed, no matter how much you want to debate

the definition of “terminally ill” in section 66(2) of the Social Security Contributions and Benefits Act 1992: a person is “terminally ill” at any time if at that time he or she suffers from a progressive disease and his or her death in consequence of that disease can reasonably be expected within 6 months.

People diagnosed with a critical illness are not necessarily terminally ill. Millions can & do recover from critical illness's, ask those who have had claims on cic if it is as you colloquially phrase it "a sham"