Critical illness protection?

Proudnanny

I’m 54 & have had to take out a small mortgage (25k) to pay my ex off. 

I would like some sort of protection in place in case I become ill & cant work & therefore can’t pay the mortgage.

I really don’t know if I should take out a critical illness cover or income protection & getting very confused! 😩

kingstreet

Income protection - permanent health insurance to be more specific.

CI will only pay out if your condition is on the list and is of sufficient severity in some cases. PHI pays out if you are unable to work and by choosing the "own occupation" definition of disability that means being unable to undertake the main requirements of your usual job.

Sandtree

Critical illness - pays a lump sum if you have one of a specific list of conditions to a specified level of severity, maybe not the best example given your user name but for example Prostate Cancer only is covered if you have a Gleason Score of 7 or more. It is in theory paid in full irrespective how much or little time off work you need. Once the policy has been in force for a while issues can arise as medical science moves on but the policy remains on the same knowledge at the time it was written (eg more keyhole surgery may exclude more heart conditions from cover)

Income Protection - talking the full fat version of PHI - replaces your income after any deferment period for as long as you are signed off sick (and some will also cover if you are fit to return to a job but not your previous job).

CI has its uses, having a major illness can make people review their life priorities and the lump sum may mean they can retire early or go part time etc. PHI however to me is the more important as its not just a list of certain conditions.

csgohan4

PHI is more expensive the older you get and more so if you have medical conditions, good practice to get it if you can when your relatively young i.e <40 if you can.