How Critical Is Critical Illness Cover?

How many Christmas cards did you receive this year that wished you a happy, healthy and prosperous New Year? I think you'd be surprised at how many! So many of us take our own health for granted, never actually stopping for a moment and appreciating that we are alive and kicking. But what happens if suddenly you or a member of your family is struck by a critical illness? Now you wouldn't wish that on anyone, but at the end of the day, it is unfortunately a fact of life for many. If you suddenly became too ill to work, could your family manage financially? If your answer is no, then perhaps 2011 should be the year you consider critical illness cover to make things a little easier if such an eventuality should occur.

Britain's leading private health care company BUPA recently revealed that a huge one in four people will develop a serious health condition between the age of 30 and 60. This is a worrying statistic when there are so many Briton's that continue their daily routine without critical illness cover. This is even more worrying when you consider that people in the UK spend around £919 a year on Life Insurance. The question is, why spend all that money of life insurance if you do not have a critical illness clause attached? Don't take the gamble on good health; look into obtaining critical illness cover either through your existing policy or independently.

As with most products offered by financial services lenders, critical illness policies will not protect you against every possible effect of varying conditions. While you will be covered against the more common life changing illnesses, full coverage cannot be guaranteed. To deal with this level of uncertainty, it is best to obtain financial advice in order to find the most suitable policy for you.

Recent research conducted by UK insurance provider Scottish Provident suggests that 6 out of 10 of us have no cover whatsoever. This statistic doesn't particularly surprise me. However, they go on to report that 35% do have life insurance but just 13% choose a policy that covers critical illness. These desperately low statistics are surely enough to shock the remaining four out of ten of us to take out some form of policy? Don't underestimate the importance of cover; it could help dramatically in time of need.

This difference between the numbers of people with standard life insurance, compared to those with critical illness shows many customers may not have a truly comprehensive understanding of the marketplace. Understandable, really, as in 2006 the FSA reviewed the life insurance market. It found that firms needed to make significant progress when it came to transparency, and the clarity of information provided to potential and current customers alike.

In the simplest terms, critical illness cover protects an individual if they suddenly contract a critical illness. The UK's biggest killers, heart disease and cancers are automatically covered in health insurance policies. Similarly, strokes, cancers, Parkinson's disease, kidney failure and Alzheimer's disease are all generally covered. However, most policies specify that the individual must survive a certain length of time following their diagnosis, usually between 1 to 2 weeks, in order to receive the payout. Therefore, it is important to thoroughly understand the policy you are considering.

However, there are some other illnesses that are not covered in such policies. Take Diabetes for example. Most individuals with diabetes can continue to live a fairly normal life for years following diagnosis, and so lenders do not include the illness as part of their policy. Yet diabetes is linked to various other illnesses which, as a result, are not insurable either. An example of which is nerve damage. Nerve damage as a result of diabetes can result in the loss of extremities, such as hands or feet, but cannot be insured. However, if a person was to lose their hands or feet by any other means that would be completely insurable. This is a shocking piece of information, especially as diabetes is the 5th most common cause of death in the UK.

Basically, this means that you could have the disease, and over time develop major problems resulting in, say, impaired use of an arm or leg. While not totally paralysed, your ability to work may be restricted, or in some industries, completely prevented. It's at this point you may realise traditional insurance is neither going to cut, or cover it. While diabetics can call on specialists like Diabetic Life, this is just one example in a long list of scenarios wherein critical illness cover would have little to no effect on the holder's quality of life, despite ill health. But with stand-alone life insurance you would have no more protection against health scenarios such as these. So if you're going to take out any kind of cover, it seems sensible to make it part and parcel of the policy.

Again, we'd highly recommend seeking professional advice to find a policy specifically tailored to you. A thorough screening should include information about yours and your parental families' medical histories, in addition to lifestyle information. Sadly, many illnesses are still impossible to detect with 100 per cent accuracy. This means there is no such thing as a comprehensive policy when it comes to protecting yourself against the unthinkable and unforeseeable. So remember that the greatest insurance of all combines a well suited, personally tailored policy, a sensible financial plan for the future, and, of course, an active, healthy lifestyle. Keep this in mind, and any nasty surprises shouldn't lead to more, unnecessary shocks. Because we can't predict the future, but we can certainly prepare for it.