Life / Critical Illness / Income Protection

absolute0

I'm looking to get life insurance and possibly critical illness cover or income protection, and I have a few questions for the knowledgeable...

1. Is it best to buy critical illness cover at the same time as life insurance, are there benefits in having it with the same insurer or separate?
2. Can critical illness be added to an existing life insurance policy at a later date - will it cost more?
3. I've gone through one of the online quotes for critical illness and they ask if I've been prescribed medication within a five year period, however, there is no option for me to disclose that I was on medication for a year and I haven't been on the medication for the last 3 years. How should I best answer these questions, and if I take the policy up do I need to notify them after 2 years to let them know I'm out of their 5 year risk period? 
4. Do people usually take out income protection for 12 months at a time, or up until 65?

Many thanks

Weighty1

to keep it short

1) it depends but adding life insurance onto a critical illness plan will normally have a fairly minimal effect on the price.  Several providers do not offer standalone critical illness anyway and always include life cover with their critical illness.

2) no, at least not without going though the medical underwriting process again which is akin to applying for a new policy.

3) look at the question in its black and white format.  Yes, you have been prescrbiedd medication in the last 5-years and therefore must answer it as such.  Depending on the end terms offered it may be beneficial to re-apply once you are outside of that 5-year period, however, there are an awful lot of medical disclosures which will not affect the terms or premium offered on life insurance or critical illness cover.

4)  the best way to arrange income protection is to cover yourself up to your anticipated retirement age (68 for many people) and to arrange a policy which has no limits on how long you can claim for, BUT, this is more expensive than a plan which only pays out for a maximum of 1-2 years.

dunstonh

1. Is it best to buy critical illness cover at the same time as life insurance, are there benefits in having it with the same insurer or separate?

Sometimes yes.  Sometimes no.   CIC is not the same with every provider.  So, if your chosen life assurance doesn't have a good version of CIC, then you are compromising your cover.

1. I've gone through one of the online quotes for critical illness and they ask if I've been prescribed medication within a five year period, however, there is no option for me to disclose that I was on medication for a year and I haven't been on the medication for the last 3 years. How should I best answer these questions, and if I take the policy up do I need to notify them after 2 years to let them know I'm out of their 5 year risk period? 

As mentioned above, you answer it as it is given.  Different providers have different ways of capturing the information and some underwrite it on the fly and adjust the pricing accordingly and others leave it on their clean health quote and only adjust the premium after manual underwriting

1. Do people usually take out income protection for 12 months at a time, or up until 65?

No. That would be pointless (and not possible in many cases).  Let's say you have an income protection policy with a 6-month deferment or a 12-month deferment.   It wouldn't be much use if the maximum payout is to month 12.

Unless you are referring to the PPI type income protections and not PHI type income protection plans.  PPI is the budget option.  PHI is the full fat version.

csgohan4

As for future readings, taking out these policies when your younger and no medical issues is better than doing it later where it is more expensive. So getting it on getting  a mortgage would be reasonable, but not 10+ years after when you have possible medical issues. 

Same with life assurance. It is false economy to put it off. 

absolute0

Thanks everyone for your replies.
I will look to combine CIC with life insurance cover.

@dunstonh - I think that raises a good point, in that I should be looking at CIC level and prioritising the benefits of this first. I'm not sure if I know what "good" looks like when it comes to CIC cover. My family has history with cancer & diabetes, so this is top on my list, but I'm not sure what else I should be looking for to give me the comparison I need.

I have phoned LifeSearch and asked for a quote, and they have pushed me down the path of Royal London with no other comparisons.

csgohan4

absolute0 said:

Thanks everyone for your replies.
I will look to combine CIC with life insurance cover.

@dunstonh - I think that raises a good point, in that I should be looking at CIC level and prioritising the benefits of this first. I'm not sure if I know what "good" looks like when it comes to CIC cover. My family has history with cancer & diabetes, so this is top on my list, but I'm not sure what else I should be looking for to give me the comparison I need.

I have phoned LifeSearch and asked for a quote, and they have pushed me down the path of Royal London with no other comparisons.

Lifesearch are a decent company, I used them for most of my assurance products. With your history, perhaps there was a reason to use a particular underwriter.  You can also do a quote on their website without advice and see what you get as well