Health Insurance: What is Critical Illness Cover?
Critical illness cover is a specific feature of many health insurance policies that pays out if you are diagnosed with a condition covered on your policy. All critical illness cover policies typically cover the following conditions:
- Coronary artery bypass
- Major organ transplant
- Heart attack
- Stroke
- Multiple sclerosis
- Kidney failure
- Cancer.
They also usually pay out if a policyholder is permanently disabled by injury or illness.
Before any payout is made you will have to meet some strict criteria. The policy will cover only critical illnesses so if you are diagnosed with a condition such as angina or skin cancer it is very unlikely you will receive a payout.
In order to be eligible a doctor must diagnose one of the covered illnesses and although medical expenses are not covered, you can use the cash to do so. Be aware however, that the policy will only make one payout so if you settle and then contract another covered illness you will not be eligible for a second payout.
Policies only cover specific illnesses so will not pay out if you contract an illness not on the list.
If you suffer from a pre-existing condition many insurers will exclude it from your policy. However, some will base their decision on your medical history. In some cases your own or your family's medical history may also be taken into account although you will be made aware of this before your policy begins.
You should also be aware that any income you have lost as a result of being ill is not covered by critical illness cover.
Before signing up for critical illness cover you should make sure you are clear about all aspects of your policy and be happy that it is the right one for you.
Tell the Truth
When initially applying for your policy it is extremely important that you disclose all aspects of your medical history. If you later require a payout and it becomes clear that you did not notify your insurer about something in your past medical history then they are likely refuse to pay out and you'll be the one left out of pocket. Insusrers can also refuse to pay out if you have falsified any information on you application, left out key facts or failed to look after your health.
Increasing your Critical Illness Cover
If you decide you would like to increase your cover, the best way to go about it is to contact your existing insurer and enquire if you can purchase extra cover or to top up your existing policy. If you rush ahead and cancel your existing policyyou may lose benefits or recive a smaller payout if you have developed any illnesses since your policy began.
Important Things to Consider
Make sure you read and understand your policy's rules and what conditions are covered.
Critical illness cover only pays out one single payment so if are unable to work and need income or mortgage protection then you should take this into consideration.
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