You want a lump sum if you were to die or become very seriously ill and could not work again. What sort of insurance do you need?

You need Life Insurance and Critical Illness Insurance policy.

STEP 1 of 2
Type of cover
Life Insurance       Mortgage Life Insurance
 
Cover Level (£)

Number of years
Do you want:  
Critical illness cover
Family income benefit
 

The Life Insurance provides the lump sum if you were to die whereas the Critical Illness Insurance pays out a lump sum if you are diagnosed with any of a long list of serious and debilitating illnesses scheduled in the policy.

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What could Critical Illness cover be used for?
Anything you want. Medical expenses, repaying the mortgage, making your home easier to live in, school fees, general living expenses, but to name a few.
Is there a minimum or maximum amount of Critical Illness cover available?
When you get an quotation, the insurer providing the quotation has agreed in principle to insure you for the sum you have requested. Therefore, you do not need to worry about this issue.
What other benefits can be added to a Critical Illness policy?
Life cover is a must. Then consider Waiver of Premium and Indexation.
What is the difference between Critical Illness cover and Terminal Illness cover?
Critical Illness Insurance is much more comprehensive than Terminal Illness cover. 1 in 5 men and 1 in 6 women suffer a critical illness before their usual retirement age.
Will a claim for critical illness affect any State Benefits?
No, it should not affect your claim for State Benefits.
If you buy a policy which combines both types of cover and have a claim under its critical illness provisions, the policy will pay out - but it will not pay out again if you were subsequently to die. As soon as a combined policy makes any payout, the policy automatically terminates and there are no more premiums to pay - and no more benefit to be had.

If you do opt for separate life and critical illness policies, then each policy pays out without any reference to the other policy. Therefore, if you contracted a critical illness, then the critical illness policy would pay out and if you subsequently died the life insurance would pay out. So in these circumstances there are two claims and two payouts.

However, a combined policy is likely to be significantly cheaper than buying separate life insurance and critical illness policies.

 

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