Confused over Life Assurance

gingergirl21

Hi

I have been reviewing our finances since our mortgage is going up, and I know I can save a lot on our current life assurance policies.

However, I am very confused.

I have follwed this site's advice and looked at Cavendish Online. I got a quote for Decreasing Life Assurance and Critical Illness cover for £40. Not bad. The policy was with NU.

I then went on to NU to see what the difference in the quotes would be (going direct v goibg through a broker). Their quote was £14.60!

I then looked at what was covered, and became even more confused as it says that they will pay out on critical illness if you are diagnosed with a terminal illness and given one year or less to live. I thought that critical illness cover paid out should one of you be diagnosed with a critical illness covering a wide range of conditions. I didn't hink that you had to be given a year to live. If this is the case, then what is the point of getting insurance for critical illness? Its going to pay out on death anyway.

Oh where have I gone wrong?

Cazza

Hi! Critical Illness and Terminal Illness are two different things. Critical Illness usually covers, as you said, a range of illnesses, most providers will give you a list of exactly what they class as a Critical Illness.

Terminal Illness is linked more with the Life Insurance part. If you are diagnosed with a illness or condition, where you have been given less than c12 months to live, they will pay out the Life Insurance early, to give you a chance to put everything "in order" before you pass away.

Are you sure it doesn't say they will pay out the Life Insurance bit (not the the Critical Illness bit) on diagnosis of a terminal illness?

As with all these things, check the policy carefully, as exact terms will vary according to different insurance companies - ie, what they will call a Critical Illness! What I've said above is just general info!