Will Critical Illness Cover be a Lifeline in your Condition?
Posted in Life Insurance on 08/27/2009 02:22 pm by adminVery few people are covered against severe illnesses even though it may strike without warning. Standard Life, the income protection provider, has carried out that say that only 4.2 per cent of the country’s work force possess critical illness insurance, even though they will collect a lump sum if they have a stroke, heart attack or suffer from cancer.
16% of people consider the cover to be too dear, the analysis reveals, which give reasons for the low take up.
Would-be clients are also puzzled by the phrasing of policies and the disparity between permanent medical cover and critical illness cover.
An operational party formed by the Association of British Insurers, is a present re-evaluating the phrasing of policies. The situation might turn out to be even more confusing if the working party decides to decrease the amount of illnesses defined as a critical illness.
Legal and General have unveiled a new product named Elixia 123, which it declares reduces the price of critical illness cover by about 25 per cent and on occasions by as much as 49 per cent.
This will be realised by permitting clients to choose the illnesses for which they require cover. There are three groups of risk. Category 1. Invasive cancer, strokes and heart attacks. The insurance will only pay out if the disease is life threatening or leads to major life style changes.
Group 2. Conditions that do not have so much impact on life expectancy but do significantly affect life style. Alzheimer’s, blindness and Motor neurone disease are incorporated in this category.
Category 3. as one is unable to forecast what the future will hold.
Critical illness insurance is not that expensive so it is prudent to opt for a comprehensive plan, which will give you peace of mind.
Nye Jones, the distribution development manager at AXA PPP Healthcare, is concerned about how the jargon is explained. She emphasises that clients must comprehend precisely what they are purchasing. Such as, when is an illness defined as major? The first and the third categories need elaboration before buying insurance as there is not much to choose between them in her view. Difficulties can happen later if the consumer has not fully appreciated the terms of the insurance policy when they Susan Pilks.