Critical Illness Insurance Policies

CRITICAL ILLNESS  Insurance Policies Compare Broker                ~ Critical Illness Life Insurance Plans On-line >15 secs  Article on:

  What are Critical Illness Insurance Policies ~ are they worth it ?            

UK Life Insurance Providers it seems have come in for some criticism over last few years, for sometimes refusing to pay out on critical illness insurance plan policies that insure against serious or critical illnesses and disability. But many Critical Life Insurance providers stated they were cleaning up their act back in 2007 with an industry-wide drive to increase consumer understanding. Remember that Critical Illness Insurance Companies are in the business of providing cover & paying out claims and for the vast majority of cases they will do so.

  Critical illness Insurance policies or Serious illness [ sometimes known also as dread disease cover ] pays a tax-free lump sum if you become seriously ill or totally disabled, but only for the specified forms of illness that are set out on the plan document. Monthly premiums are based on your age, smoker status, weight plus both personal and family medical history, and you may have to undergo a medical before cover is issued.  This modern day serious illness cover product was originally invented by Marius Barnard {the brother of Dr Christian Barnard, the famous South African heart surgeon}.

Serious illness statistically according to NHS figures will afflict roughly 1 in 4 men and 1 in 5 women before they reach 65 - which is why the idea of covering yourself is an attractive one. But Critical illness Assurance policies that protect against the financial consequences of disability have hit the headlines for all the wrong reasons in recent years, with numerous cases of insurers refusing serious illness cover claims on technicalities and leaving sick customers without money in their hour of greatest need.

What does a Critical Illness Insurance Policy usually cover ? 

Many Uk Critical Illness Providers do not cover every serious illness that can be described as critical, but many do cover the "big 3" core conditions - Cancer, Heart Attack & Stroke. Together, these "big 3" however make up more than 75% of most critical illness policy claims.

Critical Illness Insurance Policy coverage - Most policies usually now pay out on around 30/40+ other conditions ( see comparison tables below) including, aorta graft surgery, kidney failure, major organ transplant, multiple sclerosis as well as permanent total disability as a result of injury or illness. Many will include Free Child cover as well. Some new plans into the marketplace eg; the Pru Insurance cover well over 100+ critical ilness conditions but these maybe severity based which means that instead of perhaps paying 100% of a claim they may pay 25%, 50% or 75% etc;

Critical Illness Insurance Policies ~ Comparison Tables

There were increasing numbers of claims on critical illness policies being turned down either due to none-disclosure ie; where consumers have failed to put relevant factors such as existing medical conditions on application forms. Secondly, they may not fit the payout criteria by the Insurer so there is a big gap between what people think they are covered for and what they are actually insured against. Some providers reportedly like Aviva have helped the situation by advising that they have written to existing customers, to ask them if they may have forgotten to mention anything on their original application & that they may wish to now mention. Since then many providers now print their claims records - with more than 90%+ often accepted. We also have 2 opposing camps. Firstly, those Insurers who update their policies but leaving existing customers plans untouched to any improvements made. Secondly, those Insurers who update their policies & also backdating existing customers plans to any improvements made.

Critical Illness Insurance Policies - 4/2007 onwards

Before the code came in, Providers would claim to cover cancer but may sometimes exclude various less serious forms of the disease in the small print. This practice left many consumers thinking they were covered on their critical illness life cover for all types of cancer that they were not. Under the new code, which became obligatory for new policies sold from the end of April 2007, insurers will now have to spell out in the large print that less advanced cases, such as primary skin cancer, are not covered.

But Which?, the consumer body, says that you still need to go through serious illness policies with a finetooth comb to make sure you understand what you are buying. "Although this has gone some way to aiding understanding, we still found policies with tricky definitions and exclusions," says Dominic Lindley, policy adviser at Which? "It is vital that you read the policy summary or key facts document thoroughly and don't be afraid to ask questions if you don't understand anything. You should also consider whether income protection insurance, which pays an income on longer term sickness or accident, could be more appropriate for your needs than critical illness cover, which usually just pays a lump sum."

The new code also forces Critical Illness Insurance Policies providers to standardise what is and isn't covered under a particular condition. For example, some insurers could previously refuse claims on heart attacks where there was no chest pain - so-called "silent heart attacks" - but are not allowed to on new policies.

"Buyer Beware" Thinking of Cancelling Old Critical Illness Insurance Policies ?

This new code may lead to a situation where some old critical illness plan policies have less cover than new ones. This could make you think it is perhaps worth surrendering for example an old critical illness mortgage insurance policy to get a new one with better cover. But many advisers say this maybe be the wrong decision.

" The new code does make it easier for people looking to buy new Critical Illness policies to compare rates & statistics when shopping around."  However, If you bought any Critical Illness Insurance Policies several years ago you and are thinking of changing to any newer style plan, you should seriously consider reviewing your plan benefits before considering a change. Why ?

* Your health or family health history may have changed since - meaning new cover may be more expensive or have exclusions.
* It may have a guaranteed insurability option - allowing you to increase your cover without further medical evidence anyway.
* The old plan may have guaranteed premium rates - whereas a new plan maybe reviewable premiums. 
* Also, because prices have gone up so much since then, you may not get the same terms if you tried to buy the same protection cover today.

In conclusion, "buyer beware". Ask your broker to check what you have before any decisions are made to replace your critical illnes plan

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