Critical Illness Cover Information
WPP Financial Services, Rochester, Medway, Kent, could help with this.
Critical illness can be taken out with level cover and decreasing cover. Level cover means that you cover a set amount for a set term length and the amount that is covered and the amount you pay in premiums will always remain the same for the policy length.
Level cover can be used to retain your salary, new health and living costs, mortgage or rent payments and other costs such as childcare. There is also an option to make your cover amount increase in line with inflation so it matches the rise inflation but as well as your cover the premium payments will increase.
Decreasing cover can be used to help pay off a repayment mortgage or loans. This will have a set term and for a set amount of time, the monthly premiums are fixed but usually less than level cover, as the value of the repayment mortgage you will need to pay off decreases over time.
Critical illness cover pays out a tax-free lump sum if you’re diagnosed with an insured medical condition during the term of your policy and is not the same as life insurance which gives money to named people should you pass away.
This cover can be added to a life insurance policy or may be included in the terms.
Critical Illness Cover Information
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These types of plan will have no cash in value at any time, and will cease at the end of the term. If premiums are not maintained, then cover will lapse.
Your home may be repossessed if you do not keep up repayments on your mortgage
You may be offered critical illness insurance when you take out a mortgage and often the same lender will try to offer this but do . However, it’s likely that the policy you are offered will be run by your mortgage lender too; this is not always the one that is cheapest and best suited to your needs. We can give you information on the variety of products available.
Before you consider if you really need critical illness insurance you should check that you do not already have illness insurance in any other insurance policies you have e.g. life insurance and that your mortgage does not cover you for serious illness as then you will be taking out this product unnecessarily. You should also check with your empolyer to see if you have any benefits offered that pay out if you can’t work because of ill-health or disability. You might also have enough in savings that you could use to pay off the mortgage and sustain your lifestyles instead of insurance.
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