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The Peak Mortgages Guide to Critical Illness Cover

At Peak Mortgages and Protection, we offer various protection insurance policies that are designed to help you in the event of unforeseen circumstances, one of these is critical illness cover and protection. Whilst insurance policies are there to help financially, we understand that not everyone is fully informed on what these policies can do for you. 

We have put together a Peak Mortgages guide to critical illness cover for our clients, so you know exactly what to expect when investing in this policy. 

What is critical illness cover?

Critical illness cover is an insurance policy that protects the policyholder financially after a terminal illness diagnosis that is included in the insurance agreement. Critical illness insurance can be taken out at any stage but often doesn’t cover any pre-existing conditions. You might feel inclined to take out critical illness cover if people depend on you financially, as the payout can provide you with some financial stability. 

The money received from a critical illness claim is tax-free and can be used on anything, often being put towards supporting loved ones, mortgage repayments, or other household bills. 

How it can help

Critical illness cover helps the policyholder, loved ones and anyone financially dependent on you should you become unable to work. If you don’t have enough savings to fall back on, or anyone else to support you, a critical illness insurance policy is a worthwhile investment.   

Bad things happen and we want you to be prepared for the worst case scenario. Critical illness cover can give you peace of mind for the future, so you can focus on getting better instead of stressing about finances. If you’re paying out for medical bills, mortgage repayments, or other loans, critical illness cover can help contribute towards these costs, so your family members don’t have to. 

The cost

Like many other insurance policies, critical illness cover is paid monthly to your insurance provider. The monthly cost differs from person to person as your age, occupation, lifestyle, the length of the policy, and the sum assured (how much the policy will payout after a claim) will all be taken into consideration.

The older you are and the more unhealthy your lifestyle is, the higher your premiums will be. If you are looking to decrease your monthly cost, consider changing to a healthier lifestyle. We would also recommend taking out critical illness cover at a younger age to reduce the initial payments. 

Critical illness cover payouts

In the event of serious illness, you will become eligible for a critical illness cover payout. A claim can be made and if you are successful, you should receive the funds either from the date of diagnosis or an elapsed period of time after diagnosis. Each insurance policy is different so make sure you check with your critical illness cover provider before making a claim. 

It’s also important to contact your insurance provider as soon as you can after receiving your diagnosis. The lump sum will be given straight to the policyholder and can be spent however they see fit, as there are no restrictions on critical illness cover payouts. 

At Peak Mortgages and Protection, we want to help keep your family supported financially no matter what. Get in touch with us to book an initial chat in person or over Zoom and discuss investing in a critical illness insurance policy.