Health Insurance Guide

Health Insurance

Serious illness can strike at random. It causes shock, fear, turmoil … and potential financial disaster.

Imagine being suddenly diagnosed with a worrying illness, being unable to work and your income ceasing. In all likelihood you would be faced with surviving on State Benefit - which would probably mean a much lower income, paid only after a long delay or qualifying period and dependent upon exact circumstances. For example, the maximum short-term Incapacity Benefit (available between the 28th and 52nd week of incapacity) is around £63 a week (but you even have to qualify for that!).

This only adds a financial burden for you and your family to cope with - a burden that COULD mean serious repercussions - like being unable to pay the mortgage, the bills, the loans, etc.

The good news is that medical advances increasingly help us to SURVIVE serious illness. The bad news is that financially we may not. Insurance is THE ONLY ANSWER.

Critical Illness Insurance means peace of mind!

Critical illness insurance provides a substantial cash payment if you become seriously ill.

Most of us know someone who has suffered from Stroke, Heart Attack or Cancer. A Critical Illness policy will assist in providing financial security if ever you suffered from a major health problem.

Each policy will have a list of illnesses that are covered and as soon as you are diagnosed as having had one of the illnesses, a tax free cash sum will be paid to you.

Any major illness changes your life. You may recover fully after a time - but, while you are getting better, normal household bills (including your mortgage) will still need to be paid. You may also need car modifications and structural changes in your home to make life easier. Unfortunately, while you recover - which may take months or even years - your income will probably be low because you are unable to work.

The insurance payment will enable you to meet your bills, and possibly even pay off your mortgage, so that you can concentrate on recovering without the stress of money problems.

A critical illness policy is one of several types of protection you must consider when reviewing your income and capital requirements.

Almost certainly not, unless you have very substantial savings, or can maintain your normal income without working. But even if you think you could manage, it's important to be aware of the potential cost of long-term illness.

The problem some of us will have is that a major illness could cause us to be unable to work, even from home. We will be financially at risk.

Just add together a year's household bills plus your outstanding mortgage balance, credit cards, loans and non-luxury commitments and you'll get an idea of how much you could need.

Critical Illness Insurance is available from most major insurance companies, some mortgage providers, and a number of specialist health insurance providers. You can buy directly from one of the companies, or through a tied agent, or through an Independent Financial Adviser (IFA).

If you buy directly from an insurance company your only option will be their product. You will have greater choice if you buy from a tied agent, but only from the limited range of products that they sell - and you will receive no advice in respect of competitive policies.

Unless you are prepared to investigate the entire Critical Illness Insurance market yourself, which would be a massive undertaking, the most reliable way to buy your policy is through an Independent Financial Adviser (IFA). After discussing your personal circumstances, the IFA will recommend the best insurance solution to suit you, from all of the products available in the market place.

With around 130 critical illness policies available on the market with different illnesses covered, variable rates, and optional benefits - this can be a very difficult decision.

Products vary from Annually Renewable cover for a limited number of illnesses, to Whole of Life policies covering a large range of conditions. It can be very difficult to know that you are comparing like with like. That's why it makes sense to seek professional guidance, with impartial advice from a qualified Independent Financial Adviser (IFA).

Sometimes, no matter how simple the task seems - you need help!