Xray of lungs

Critical illness cover: Is it worth it?

Do you need critical illness cover alongside your life insurance policy? Read on to help you decide...

If there’s one thing we know, it’s that life is full of surprises. While we can enjoy the good surprises when they come our way, we can also prepare for some of the bad.

Critical illness insurance protects you against a wide range of serious conditions. If you become ill, you’ll receive a tax-free lump sum on diagnosis which can be put towards whatever you choose.

Glenn’s story

Glenn Charles and his wife Janice run the Cherry Tree Home Bakery in Northern Ireland. Set up by his parents more than 50 years ago, the bakery is a labour of love for Glenn, making time off, whether for a holiday or even a long term illness, extremely tricky. But that’s exactly what happened in January 2019. During a routine check-up for the acid reflux he’d managed over the years, the doctors found something more serious.

“There’s no easy way to say this,” his doctor had told him bluntly, “but you’ve got cancer.” Glenn’s diagnosis triggered concerns about how he’d cope with needing time off work for treatment and recovery. And there was a major worry the cancer may have spread. Thankfully, Glenn had taken out a joint critical illness policy with his mortgage 20 years ago to safeguard his family and the business. After his diagnosis, he claimed and, within days, it was accepted.

Glenn’s monthly premiums for the cover were about £100 and his pay out cleared his mortgage and made the family financially secure – and it left something spare for a much-needed family holiday. He admits that over the years, particularly during the financial downturn, there were times when he and Janice came close to cancelling the policy due to financial pressure. Further tests confirmed the cancer was isolated, and Glenn had a procedure to remove it. Now Glenn is back kneading dough at The Cherry Tree Home Bakery.

Do I need critical illness insurance?

Whether or not you need critical illness cover as well as life insurance depends entirely on your individual circumstances. To help you decide, here are three things to consider:

Does your family depend on your salary?

Many of us depend on our salaries to support our families. If you’re the main breadwinner of the house, or you contribute 50/50 with your partner, could you cope financially if your income was slashed or wiped out entirely?

If your answer is ‘no,’ then critical illness cover could give you peace of mind should you fall seriously ill.

Getting a lump sum if you could no longer work could help you maintain your current standard of living. You can spend the money on anything you wish, from covering living expenses and medical bills, to upgrading your home and taking the trip you’d always wanted to take. It would be up to you.

As the Money Advice Service explains*, Employment and Support Allowance ranges from about £70 to £100 a week, if you’re eligible and depending on your condition. You may also receive sick pay from your employer. However, for many people, it may not be enough to cover the cost of living.

Do you have any savings? 

Critical illness cover might not be so important if you’ve got significant savings, which could be used to cover your mortgage, living and medical costs if you were diagnosed with one of the illnesses covered by your policy. The same goes if your partner would be able to cover your family’s expenses.

What’s worth bearing in mind is that with critical illness cover, you choose your level of cover as well as the length of the policy.

So if you think you’d only need a little financial support, or you want to be covered up until your mortgage is paid off, you can tailor your policy to suit your needs.

Does your job cover long periods off work? 

Certain companies include cover for long-term sickness absence as part of their employee benefits scheme, but it’s standard to only cover statutory short-term sick leave.

It’s worth checking with your employer, and considering whether it would be enough for you and your family to live on.

Nicola’s story

Nicola Groves is 45 and married with two sons, aged 10 and four. Her journey started in the summer of 2013, with discomfort in her breast. She visited her GP who told her she was low risk and it was probably nothing to worry about. It took two further visits for her to be referred to a specialist clinic where she was given an ultrasound and biopsy.

“When I heard the words ‘There is good and bad news – you do have breast cancer and you are going to lose your breast’, I felt as if time stood still. And masses of information about a mastectomy and reconstructive surgery was just too much to take in,” said Nicola. After clear tests on her lymph nodes in July 2014, she was booked in for surgery. Despite a lengthy operation and ongoing physiotherapy, Nicola says the pain has been manageable.

Nicola and her husband took out a decreasing term life insurance and critical illness policy in 2012, paying a monthly premium of £83. The settlement from her policy amounted to more than £75,000. At the time, her 10-year-old son received a bravery award from his school teacher for how he coped with his mum’s illness, while her younger son wasn't aware of what was happening.

Nicola said: “His birthday celebrations had to be put on hold, though a day trip to Blackpool is now well overdue and something we will cherish as a family.” 

If you were to become ill, you don’t want finances to add to your worries. Critical illness cover is there to provide a financial cushion if you need it, leaving you to focus on looking after yourself.

What now?

Find out more about Zurich life and critical illness insurance.



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