Critical illness help

angel1111

I am looking at extending my life insurance with beagle street so putting through a new quote

£220,000 to cover mortgage with some left over and £30,000 critical illness

My monthly budget is stretched at the moment

Am I right in understanding that if I was to claim on critical illness my family would then not be able to claim on death? this would be no good as 30000 is not going to pay off the mortgage.

I am not sure if it is worth me taking out critical illness?

Aretnap

angel1111 wrote: »

Am I right in understanding that if I was to claim on critical illness my family would then not be able to claim on death?

No, you're mistaken. Beagle Street's website explains this.

https://www.beaglestreet.com/life-insurance/critical-illness-cover/

There are two types of critical illness policies in the market, although we only offer additional critical illness cover.

Additional Critical Illness cover

Available directly through Beagle Street, this acts separately to your life cover, providing more flexibility. The risk is separated, meaning if you claim your Critical Illness then your Life Insurance policy is still in place. We give you a breakdown of your premiums and cover amounts for both your Life Insurance and Critical Illness cover. This gives you control over how much cover you need, ranging from 10% – 100% of your Life Insurance value.

Combined Critical Illness cover

Not available directly through Beagle Street, this cover links your life cover and Critical Illness policy, meaning there is only one pay-out. You can only make one claim, so if a claim is made upon diagnosis of critical illness then your entire Critical Illness and Life Insurance policy will cease; a claim can therefore be made in either instance of death or diagnosis of a critical illness.

So any policy you buy through Beagle Street will be of the additional type - where the life and critical illness elements are separate and you can claim on both.

Combined policies do exist, but generally they have a single sum assured - so if you had £220,000 of cover the policy would pay out the full £220,000 on critical illness, or death, but not both. Obviously this would be more expensive (all else being equal) than the type of policy you're looking at - critical illness cover is more expensive than life insurance, because it's significantly more likely to pay out.

kingstreet

Beagle Street critical illness cover is rated only three star by Defaqto which means you may not be able to make a claim where cover with another provider would have seen a payout.

https://www.defaqto.com/star-ratings/life-and-protection/critical-illness-level-term/

Cheap may be cheap for a reason.

angel1111

Thank you for clearing things up for me, that makes a lot more sense.

I am aware it may not be the best cover but It is the top of my budget..

Weighty1

angel1111 wrote: »

Thank you for clearing things up for me, that makes a lot more sense.

I am aware it may not be the best cover but It is the top of my budget..

I'm guessing you haven't taken any advice on this cover? How do you know it's the top of your budget if you've not had an adviser structure the cover in a way that might better suit your needs?

angel1111

We did have advice originally when we took out our mortgage but the payments were to high for us, this is the best we could find on a comparison site for our needs, but maybe we need to go see a professional again.

Weighty1

If you speak to an adviser and lay out the budget that you are happy to spend then they may well be able to structure the cover in a different way.

For example, it *may* be possible to get a budget income protection plan which pays out for up 2-years if you have ANY illness for a similar cost to the critical illness cover which only covers certain conditions - that would provide FAR better cover. Or it might be worth considering having a little bit less critical illness cover and have a plan which is far more comprehensive. Some plans allow add on which aren't available via the comparison sites. Aviva, for example, offer Global Treatment which provides access to the best hospitals/consultants in the WORLD if you are diagnosed with cancer, need brain or spinal cord surgery, heart valve replacement/repair plus a couple of other things. It's £4/month to add on but maximises your chances of making a recovery following a serious diagnosis - no GoFundMe pages needing to be set up.

Unless you know about things like this you could easily be selling yourself short.

angel1111

Thank you for your help, I am going to make an appointment with a professional.

Weighty1

angel1111 wrote: »

Thank you for your help, I am going to make an appointment with a professional.

If I was you I'd try and find a professional who focusses specifically on protection policies as it may be an IFA who deals with everything may themselves not be fully up to speed with these sorts of add-ons.

Just make sure that whoever you speak to is an independent adviser so that they can offer plans from whichever insurance provider is most favourable for you.