Should I Take Out Life Insurance With Critical Illness Cover?

antoine fruchard Antoine Fruchard  updated on September 30, 2020

The big question is: is life insurance enough to cover me? Or should I take out life insurance with critical illness cover? There are so many things to consider. If you’re looking for the answers, you’ve come to the right place! 

In this guide, we will explain everything you need to know about critical illness insurance: what critical illness covers and doesn’t cover, and all the terms and conditions you should look at before taking out a critical illness policy. 

Stay tuned!

What is critical illness insurance? 

Critical illness insurance is an extra that can be added to your policy, or can be combined with your standard life insurance. It pays out a tax-free lump sum if you contract a disease. The illness developed must be specified in your policy contract. Critical illness is defined as an illness that is curable; this is different from terminal illness, where the life expectancy is really low (not more than one year). Terminal illness is usually covered by life insurance. 

The most common illnesses covered by critical illness insurance are heart attacks, stroke, non-terminal cancer etc. If you become really ill, your insurance will pay out exactly as if you’ve passed away. 

Does life insurance cover critical illness?

No, you must choose to include critical illness cover to your life insurance. 

There are standalone critical illness cover options, but these are quite rare, and most people take out critical illness cover with their life insurance policies. You will be asked to choose the amount of life insurance you want and the amount of critical illness you would like to be covered for. 

There are two types of life insurance and critical illness cover: 

Combined critical illness:  If you combine critical illness with standard life insurance, it pays out for the first event that occurs – death or illness. It will pay the full amount chosen. 

Additional critical illness: You will be covered for the two events. If you get ill, your critical illness protection will be covered. If you die a few years later, you will also be covered. So, life insurance with critical illness cover as an add-on is more protective. 

What does a critical illness policy cover? 

Critical illness insurance covers:

  • Yourself: in case you contract a disease listed on the contract you’ve signed with the insurer.
  • Your children: critical illness covers your children. Usually it covers £25,000, or 50% of the cover amount. Read the small print in your contract to check what is covered. 
  • You partner: you can have a joint critical illness policy, but it will pay only once, when the first partner dies. 

Is it worth buying critical illness cover? 

Yes, it is worth taking out critical illness insurance. 

  • First of all, you should consider taking out critical illness because it is the best way to protect your loved ones in case of illness. 
  • Another good reason to take out critical illness cover is about the children’s cover included in critical illness. If your children get really ill, you can claim a percentage for them too. Some insurers include children’s critical illness as standard when taking this add-on – Legal and General, for example.

What types of illness are covered by critical illness insurance? 

The types of illness covered by critical illness insurance depends on your insurer, but usually the following illnesses are covered by life insurance and critical illness cover: 

  • Heart attack 
  • Cancer (non-terminal)
  • Strokes

Usually, around 50 conditions are covered by critical illness insurance. Don’t forget to carefully read all items listed on the terms and conditions when taking out critical illness cover. 

What is not covered by critical illness? 

Critical illness doesn’t cover: 

  • Terminal illness (life expectancy of less than one year). Terminal illness is covered by your life insurance. 
  • Diseases that are not severe enough won’t be covered by critical illness cover. 
  • Usually it doesn’t cover conditions such as Parkinson’s and organ transplants, but some providers do cover these kinds of illness. 

We can see that it is not only about listed conditions, but on the definition itself of the disease. If the illness is too severe, critical illness won’t cover it, but if the illness is not considered severe enough, it will not be covered either. 

How much is critical illness insurance? 

How much your life insurance with critical illness cover will cost depends on several factors: 

  • Your age: the earlier you take out life insurance with critical illness, the cheaper it will be 
  • Your medical conditions 
  • Whether or not you are a smoker 
  • Which add-ons you add to your life insurance with critical illness cover
  • Your salary
  • The coverage you want: you will choose the coverage you want for your life insurance and for critical illness
  • Whether you take out a joint policy or not 

In this table, we can see how much it costs to have critical illness cover with either joint life insurance or single life insurance. 

Age groupCritical illness add-on to life insurance with a joint life insurance policy (monthly premium)Critical illness add-on to life insurance with a joint life insurance policy (monthly premium)
18-28£24.63£12.70
28-38£44.58£26.63
40-48£92.09£50.87
50-57£174.89£103.89
More than 60 years old £528.06£333.10
critical illness cover cost (Average level term insurance (10 years to 20 years): additional critical illness )

When should I take critical illness cover?

There are no set moments in life to take out this insurance, but it could be a good idea during such times when:

  • You’re starting a family: if your family depends on you financially, it is always better to have a life insurance plan with critical illness cover in place.
  • You’re buying a house and are taking out a mortgage: this can protect you in case you become ill during the loan. 
  • You are not protected by your job: in this case, it could be a great idea to take out critical illness cover. 

What are the best critical illness cover quotes?

In this table, we summarise all the important features you should consider when choosing life with critical illness insurance: 

Best life insurance with critical illness cover Details Premium
vitality logo
  • Vitality’s plan is called ‘Serious Illness’ cover.
  • Two types of critical illness cover: comprehensive and primary critical illness.
  • Comprehensive critical illness covers 182 conditions, which is more than the other critical illness providers cover.
  • 7% of serious illness claims paid in 2018 were unique to Vitality.
  • Coverage of earlier stages of disease in certain conditions.
Level: £58.61
royal london logo
  • 47 critical illnesses covered
  • Covers 13 early forms of cancer
  • Helping Hand service: gives access to a dedicated nurse 94% claim pay-out
Level: £55.10
aig logo
  • More than 100 conditions covered
  • Children’s cover 91% claim pay-out
Level: £61.60
logo lv
  • 48 conditions covered
  • 10 conditions where LV pay double the cover
  • Children’s cover 88% claim pay-out
Level: £57.57
logo zurich 1
  • 40 serious conditions covered with Zurich’s critical illness plan 
  • You can upgrade and take out Zurich’s Critical Illness Select option with 51 conditions covered
Level: £57.61
aegon logo
  • 93% of claims paid out 39 conditions covered
  • Children’s cover, 50% of the benefit amount, or £25,000
Level: £56.48
Best critical illness cover (£100,000 critical illness cover – 40 years old – non-smoker) 

What are the critical illness insurance pros and cons? 

Here are the pros and cons of critical illness insurance: 

  • You are better protected
  • Peace of mind for your loved ones
  • Covers main conditions 
  • Does not cover all conditions 
  • More expensive than just taking out life insurance

How long does critical illness insurance last? 

Critical illness cover is usually sold with life insurance, so the term will end at the same time as the life insurance. 

How do I cancel critical illness cover? 

You have 30 days to change your mind when taking out critical illness insurance. After 30 days, if you want to cancel your critical illness cover, you may have to pay fees, depending on providers. Insurers will give you back your money on a pro-rata basis, but usually not the month that has already started when cancelling.

Can I get critical illness cover for my children? 

Most of the providers offer this, such as: 

  • AIG critical illness
  • LV critical illness

But other providers will only offer it as an add-on, such as Zurich’s critical illness cover.