Life & Critical Illness Protection

Life Insurance & Critical Illness

What is Life Insurance & How can it help me?

Life Insurance (sometimes known as Life Assurance) helps provide financial security for people who depend on you, should you die.

Although money can’t replace a loved one, it can help those left behind to weather the financial storm. For example, it could pay off the mortgage or provide an income to help cover regular household expenditure.

Types of Life Insurance

There are different types of Life Insurance – the most appropriate type for you will depend on your circumstances. Life Insurance will pay out either a single lump sum (sum insured) or a regular income when you die.

Term Insurance

  This is the simplest type of Life Insurance. You choose how long you’re covered for, eg. 20 years (the term), and the policy pays out if you die within the agreed term. You can also take out term cover as a couple, with the policy paying out on the first death only during the term. There are several different types of Term policy available, depending on your needs.

Family Income Benefit Insurance

 – This is essentially the same as Term Insurance, but instead of paying a lump sum when you die, it will pay out a regular income instead. This type of payment may be more suitable where the main purpose of the policy is to provide ongoing financial support to dependants.

Whole of Life Insurance

This pays out a lump sum when you die, whenever that is, as long as you are still paying the premiums.

What is Critical Illness Protection & How can it help me?

Critical Illness Insurance pays out a tax-free lump sum on the diagnosis of certain life-threatening or debilitating (but not fatal) conditions including heart attack, stroke, cancer and major organ transplants.

This list will vary depending on the insurer, as will the exclusions for making a claim.

Critical Illness Insurance often comes as an optional addition to a Life Insurance policy, but can also be purchased on its own.

Policies usually only pay out once, so they don’t necessarily replace your regular income, but you can use the money towards medical treatment, your mortgage or anything else you choose.

Many people buy Critical Illness Insurance when they take on a major commitment, like a mortgage, or start a family. However, since we’d all like to have our financial commitments lightened if we were to suffer a serious illness or injury, the cover is relevant for most of us at any time.

If you already have Critical Illness Insurance you should think carefully before you cancel your existing policy and take out a new one.

For example, if you’ve developed any illnesses since you first took out the policy, you may lose some of the benefits when you replace it. That’s because pre-existing medical conditions may not be covered by the new policy.