Critical Illness insurance for spouse?

JayZed

I get CI insurance for myself and my wife through my benefits package at work. It's pretty cheap for me, slightly less cheap for my wife, even though I'm covered for twice as much as her. It costs £17.25/month to cover her (mid-40s, non-smoker) for £50,000, and £9.90/month to cover myself for £100,000. We also both have life insurance, which is separate from the CI cover.

We both work, but I'm the main earner. We could get on fine (in terms of mortgage repayments and other living costs) without my wife's income, but not without mine.

It's renewal time, and while I plan to keep CI cover in place for myself, I'm wondering whether it's worth continuing to cover my wife for CI as well. Any thoughts?

dunstonh

I'm wondering whether it's worth continuing to cover my wife for CI as well.

Is she going to suffer a critical illness or not? Of course you cant answer that but that is what it comes down to. If she doesnt you think its a waste of money. If she does then it was worth every penny.

I have had a couple of CI payouts go through recently. Both were almighty grateful they had it but one was sceptical at the time of application.

JayZed

I don't think it's a question of whether or not she's going to suffer a critical illness. In my view what it comes down it is what the impact would be on us financially if she were to suffer a critical illness.

As I've said, I'm confident that we would be comfortable without her salary - what I'm wondering is whether the primary purpose of CI insurance is to provide a financial cushion against loss of income, or whether you're insuring against the potential additional costs that might come with critical illness (e.g. additional childcare, domestic carers etc).

somethingcorporate

If your wife was critically ill and you needed to leave employment to look after her - how would that impact your finances?

ACG

Its not just a case of losing her income. the other things are things like carers - im not going to use examples as im not a fan of tempting fate but im sure you can think of examples where your wife may get an illness that requires a carer to come round.
You also have things like changes to the home - stair lifts, wheel chair ramps, widened doorways etc.

Personally im not Critical Illness' biggest fan. I tend to put it down the list of priorities but i certainly wouldnt say there was no need for it.

Annisele

I'm not a huge fan of critical illness either (but I'm not an adviser).

I prefer PHI/income protection insurance. I don't have children, and my partner would be (financially) just fine if I dropped dead. The thing that would seriously mess up our finances would be for one of us to become too ill to work, and the other to have to give up work to look after them.

Critical illness is all well and good - and does have a place - but if you end up with an illness that doesn't count as 'critical' under the policy but nevertheless stops you working, it doesn't pay squat.

I think PHI is useful under a broader range of circumstances - but that doesn't mean CIC isn't useful for you.

Most people end up saying that they have £x for their protection needs, but full protection for everything would cost 10 times £x (or some other large figure). So, they decide what cover is most important to them, and lop off the stuff at the bottom that isn't so important (for me, no life cover - but if I had children I'd do that differently). If you're not sure what order your protection needs come in, go see an IFA.