McLean’s Financial Services

Peace of mind when you need it most

If you are diagnosed as having one of the specific life-threatening conditions defined in your policy, critical illness insurance pays out a tax-free lump sum, giving you peace of mind when you need it most. When you suffer from a critical illness it can seriously affect you financially and the last thing you need is to face not being able to pay bills or make mortgage payments.

Some policies also offer both life and critical illness cover. These pay out if you are diagnosed with a critical illness, or you die, whichever happens first. Although not all policies cover all critical conditions, industry guidelines say that to call itself critical illness insurance a policy must offer cover for cancer – but only advanced cases; heart attack – if sufficiently severe; and, stroke – if it results in permanent symptoms.

A basic plan will typically also cover kidney failure, major organ transplants, multiple sclerosis and coronary bypass surgery. More serious conditions are covered in more comprehensive policies, and many also include loss of sight, permanent loss of hearing and a total and permanent disability that stops you from working. Some policies also provide cover against the loss of a limb.

A policy will provide cover only for conditions defined in the policy document. For a condition to be covered, your condition must meet the policy definition exactly. This can mean that some conditions, such as some forms of cancer, won’t be covered if deemed insufficiently severe.
Similarly, some conditions will not be covered if you suffer from them after reaching a certain age, for example, many policies will not cover Alzheimer’s disease if diagnosed after the age of 60.

Very few policies will pay out as soon as you receive diagnosis of any of the conditions listed in the policy and most pay out only after a ‘survival period’ of typically 28 days.

Because policies vary widely in the cover they offer, you should obtain professional independent advice to ensure that you obtain a critical illness policy that is appropriate for your particular needs. An adviser will also be able to help you decide how much cover you need, how long the policy should last and whether you should combine critical illness and life cover.

How much you pay for critical illness cover will depend on a range of factors, including what sort of policy you have chosen, your age, the amount you want the policy to pay out and whether or not you smoke.

With so many different insurance policies available, it can be difficult to know which ones will best protect your family from financial hardship. To discuss your situation, please contact us.

For more information or to discuss anything in this article feel free to contact Doug McLean via email or phone.