Critical Illness Cover – Overview
Pays out a lump sum in the event of death, earlier diagnosis of a terminal illness or meeting the definition of one of the named critical illnesses within the term of the plan or pays an additional payment in the event of carcinoma in situ of the breast and low grade prostate cancer.
This contract offers reviewable premiums only.
Where a lump sum is required to help provide financial support to a spouse, partner, registered civil partner or dependant in the event of death or becoming critically ill.
Where there is an interest only mortgage and a need for a policy that pays out the same lump sum throughout the length of the policy in the event of death, terminal illness or critical illness.
Where a lump sum is required to:
- Cover the loss of a key person.
- Purchase the shares owned by a director or partner.
- Cover an interest only business loan.
Suitable if customers
- Want to take advice on the suitability of the product
- Want the level of cover to remain the same throughout the term of the policy.
- Need a lump sum in the event of death, terminal illness (if life expectancy is less than 12 months) or critical illness and have dependants, and are not willing to self-insure or do not have funds elsewhere.
- Have a business need to cover the loss of a key person, to provide finances to purchase shares of a director or partner in the event of their death, or to cover an interest only business loan.
- Have medical conditions that do not prevent provisions of cover and are happy to be underwritten.
- Are UK resident and can afford monthly premiums for Life Insurance with Critical Illness Cover.
Unsuitable if customers
- Wish to purchase direct without advice
- Want their policy to decrease. (Decreasing Life Cover)
- Want a product to pay a monthly benefit if they are unable to work for a period of time.
- Want a product to pay a benefit if they are unable to work for a period of time due to accident or injury (IPB)
- Do not have a business need to cover the loss of a key person, to provide finances to purchase shares of a director or partner in the event of their death, or to cover an interest only business loan.
- Have health conditions that may result in cover not being issued.
- Do not need death, terminal illness (if life expectancy is less than 12 months) and Critical Illness Cover / without dependants and are willing to self-insure and have sufficient funds elsewhere.
- Require a non-underwritten journey.
- Are unable to afford Life Insurance with Critical Illness Cover and are not UK resident.
Amount of Cover
- No minimum sum assured. Driven by minimum premium.
- Maximum sum assured:
£3 million - if Specific Work Tasks definition under TPD applies, or
£2 million - if Own Occupation definition under TPD applies.
- The amount of cover remains level throughout the term of the policy.
- The minimum term allowed is 5 years (2 years if Life Insurance with Critical Illness Cover is chosen).
- The maximum term allowed is 40 years.
- The minimum age to take out a policy is 18. It is possible for a life of another policy to be taken on a 17 year old by an adult with insurable interest. This policy can then be placed in an Absolute trust with the 17 year old as the beneficiary.
- The minimum age at the end of the policy is 29.
- The maximum age for buying a policy is 64 (or 67 if Life Insurance with Critical Illness Cover is chosen).
- The policy must end by their 70th birthday.
- Payable monthly or annually by Direct Debit.
- Children's Critical Illness Extra (available for an additional cost)
- Legal & General GP24 Service (available for an additional cost on Critical Illness products purchased on/after 27 November 2017, excluding reviewable Critical Illness and Business Critical Illness)
- Immediate Cover
- Total and Permanent Disability
- Waiver of Premium (WOP)
Benefits automatically included
- Accident Hospitalisation Benefit
- Accidental Death Benefit
- Changing your policy (Previously known as Guaranteed Insurabilty Option)
- Children's Critical Illness Cover
If the policy is mortgage related, then the following are also included
- For joint life policies, benefit is paid on the first critical illness claim or death, whichever occurs first.