CRITICAL ILLNESS INSURANCE
For the hard times
CRITICAL ILLNESS INSURANCE FOR SELF EMPLOYED PEOPLE
For the hard times
What is Critical Illness Insurance?
Critical illness insurance is a type of policy that pays out in the event of the self employed policyholder suffering a serious illness. If that happens, the insurer pays out a lump sum of money, and then the policy is finished. It’s designed to cover the costs of treatment, specialised equipment, and the loss of an income that can follow a serious illness.
It’s important to note that not all conditions are included, and that the amount of cash that a person will receive isn’t pre-determined; the amount is calculated on a case by case basis.
Who Needs Critical Illness Insurance?
Not everybody needs to have critical illness insurance. If you have enough savings to compensate for a loss of income, or you have a partner who could provide for you financially in the event of your being unable to work, then it may not be necessary. However, if you are self-employed and would struggle to make ends meet if you were injured and unable to work, then it may be a good option.
Additionally, it’s important to remember that life Insurance and critical illness insurance offer more than just a replacement of income; they also bring peace of mind that you and your family would be financially secure, even if the worst should happen. Each year, a large amount of people within the UK have to give up work due to an injury or illness.
What Illnesses Are Covered in Critical Illness Insurance?
In general, most illnesses that would prevent you from working are covered but it would be down to the insurance policy wording. For example, if you were to have a stroke, then you’d receive a payment. There are certain illnesses that aren’t covered, even if they sound scary. Some cancers, for example, won’t be eligible for payment if it’s detected in the early stages and there’s a high chance of a full recovery.
When a claim is made, they’re investigated by the insurer, and then a decision is made. In some cases, requests for payment are denied because they weren’t aware of a pre-existing condition or the condition isn’t serious enough.
 What Can You Do With The Money?
Whatever you like. It’s a no strings attached payment. Many people elect to invest the money, so as to generate an income, while others use it to make living with their condition more agreeable. It’s entirely up to you, though: once the payment is made, the arrangement with the insurer comes to an end.
What Affects Critical Illness Insurance Cost?
The cost of the policy depends on various factors. The insurer will assess your age, lifestyle (smokers and heavy drinkers pay more), and your job: some positions are more dangerous than others, and are thus the worker is at greater risk. The rest will depend on the type of policy you want. For example, the amount of cover you want, the number of conditions included, and so on.
Like all insurance, you hope you never need it. But if the worst were to happen, then critical illness insurance can provide a financial cushion and peace of mind. We do advise on Critical Illness Insurance here at Active Mortgage, if you are thinking about this service, please so speak with one of our mortgage advisers so that they can explain in detail. You can do that by calling 01245 850 165 or by contacting us here.
These articles are for information only and no advice should be conferred from the content within. Please seek independent financial advice prior to taking any action.