Critical Illness cover

lisaannhalliday

Hi everyone,

I currently have critical illness cover that means if I become ill and am unable to pay my mortgage they will cover the cost or if I die they will pay off the mortgage.

I wondered what this would be reffered to on this site as I want to look at other quotes to see if I have a good deal or could get a better one.

Thanks,
L

Wutang_2

Speak to an IFA - it pays out a lump sum if you are diagnosed with a specific illness (not if you "become ill").

Some insurers pay out for more illnesses than others and therefore cheap cover is often cheaper for a reason.

dunstonh

I currently have critical illness cover that means if I become ill and am unable to pay my mortgage they will cover the cost or if I die they will pay off the mortgage.

You say you have critical illness cover but go onto explain permanent health insurance (sort of). Which is it that you have?

I wondered what this would be reffered to on this site as I want to look at other quotes to see if I have a good deal or could get a better one.

DIY is useful for people that know what they have and know what they wont. Get it wrong and you can make a right pigs ear of your finances as you only usually find out its wrong in the event of a claim. If you DIY you get no consumer protection as you are making the decisions and taking on the role of the adviser.

lisaannhalliday

Hi,

Thanks for your replies. Sorry for my delay.

The policy I have is called a Mortgage Protection Policy and it is a decreasing term assurance. So, my understanding is that if I get certain critical illnesses or die my mortgage will be paid off.

Does this sound correct?

Basically my partner and I had this policy together but now we have seperated and I have kept the house. I pay £50 a month for both of us and the company have said I can get some sort of deed of assignment which will mean I continue to pay for both of us but I will be the only beneficiary. Is this the best thing to do?

Or should I see a financial advisor?

Thanks,
Lisa

OshayAway

lisaannhalliday wrote: »

Hi,

Thanks for your replies. Sorry for my delay.

The policy I have is called a Mortgage Protection Policy and it is a decreasing term assurance. So, my understanding is that if I get certain critical illnesses or die my mortgage will be paid off.

Does this sound correct?

Basically my partner and I had this policy together but now we have seperated and I have kept the house. I pay £50 a month for both of us and the company have said I can get some sort of deed of assignment which will mean I continue to pay for both of us but I will be the only beneficiary. Is this the best thing to do?

Or should I see a financial advisor?

Thanks,
Lisa

See a whole of market IFA / protection specialist. Depending on your personal circumstances you should be able to save a considerable sum on your premiums as the only one covdered. They will also be able to advise on any 'down-sides' e.g. the difference in conditions covered etc.

lisaannhalliday

Thanks,

but what is this type of insurance called, what I mean is if I'm looking for advice from this site where should I look?

Also, I rely on his maintenance to cover my mortgage payments so without them I'd be in real trouble. So, therefore, should I not do this deed of assignment thing so that if anything ever happened to him and we lost the maintenance payments the mortgage would be covered?

OshayAway

lisaannhalliday wrote: »

Thanks,

but what is this type of insurance called, what I mean is if I'm looking for advice from this site where should I look?

Also, I rely on his maintenance to cover my mortgage payments so without them I'd be in real trouble. So, therefore, should I not do this deed of assignment thing so that if anything ever happened to him and we lost the maintenance payments the mortgage would be covered?

The deed of assignment has to be done on advice of an IFA and using a solicitor. Basically, it is used to change the ownership of the plan. As it stands, (unless it has been written into trust) in the event of your death, the policy will payout to the joint policy holder by default. Going down the deed of assignment route will also require the joint policy holder's signature.

It sounds like you have a joint decreasing term death or earlier critical illness plan. This is designed to pay off your outstanding mortgage balance with a lump sum, in the event of your death or diagnosis of a critical illness. A good IFA / protection specialist will be able to advise you the cost of arranging a similar plan just in your name only and the difference in cover.

There is no advice on this site about which providers offer the most comprehensive plans of this type, not suprising as it is a little involved. This is especially so when comparing with existing critical illness plans that have been in force for some time as generally, the older plans are more comprehensive. By way of an example, many older plans will pay out on angioplasty as it was a procedure only carried out in very serious circumstances. Now it is far more routine and common place, it's no wonder that insurance providers don't consider it to be 'critical' or life threatening. This is just one of several examples.

In regard to your ex-partner, if you keep it as it is, the policy would work in the same way as when it was arranged, so in the event of his death the benefit would come to you as the joint policy holder. But if he was diagnosed with a CI, the money would likely be used to care for his needs not yours. If you want to protect his ability to provide for you, a PHI (income protection) policy in his name may be more suitable and would protect his interest and yours providing he was insured for enough to keep up the maintenance.

Hopefully you can see the value of advice in this instance.