Critical Illness Cover
Critical illness cover protects you and your family from the financial burden of suffering from a critical illness. When serious illness strikes, the last thing you want to worry about is money. Critical Illness Cover from Connect Mortgages gives you breathing space when you need it most, offering a financial lifeline so you can focus on recovery, not repayments. It’s not just about policies. It’s about peace of mind.
The financial burden of critical illness can be heavy for individuals and their families. That’s why critical illness coverage is so important. Understanding the different types of critical illness coverage, benefits, and costs is vital to deciding if critical illness coverage is right for you. This article provides an overview of critical illness coverage and walks you through the critical steps to ensure that you have the right protection in place.
We explain the different types of critical illness coverage, provide tips on finding suitable critical illness coverage for your needs, and much more. Read on to learn more about critical illness coverage and how it can help protect you and your family.
What is Critical Illness Cover?
Critical Illness Cover provides a tax-free lump sum if you’re diagnosed with a serious medical condition such as cancer, heart attack, stroke, or multiple sclerosis, and survive the initial waiting period (typically 10 to 14 days). Unlike life insurance, which pays out upon death, critical illness protection supports you while you’re alive, helping you stay financially stable during recovery. This cover can ease the pressure of ongoing costs such as your mortgage payments, household bills, or necessary home adaptations. With the right mortgage protection strategy, you can focus on healing without the added burden of financial stress.
Who Should Consider Critical Illness Cover?
Critical illness cover is essential for anyone with a mortgage, family responsibilities, or outstanding debts who wants financial stability in the face of serious illness. If a life-altering condition, such as cancer, heart attack, or stroke, prevents you from working, a lump-sum payout can help cover your living costs, medical treatment, and even necessary home modifications.
This protection is especially important if your employer’s sick pay is limited or you’re self-employed and lack access to long-term support. Rather than worrying about missed payments or mounting expenses, you’ll receive vital financial support, letting you focus on recovery, not the bills.
Learn how mortgage protection and income protection insurance compare to critical illness cover, or contact our expert team to discuss a plan that fits your lifestyle.
Protect Your Future with Critical Illness Cover
Critical Illness Cover from Connect Mortgages provides a tax-free lump sum if you’re diagnosed with a listed serious illness. This financial support helps you focus on your recovery, not your bills, offering essential peace of mind when it matters most.
Why Choose Critical Illness Cover?
Financial Stability During Illness
If a critical health condition stops you from working, this cover can help replace lost income. It ensures you’re not left financially vulnerable during treatment and recovery.
Cover for Daily Living Costs
The lump-sum payout can help with:
- Monthly household bills and essential expenses
- Mortgage or rent payments
- Repaying personal loans or outstanding debts
- Childcare and family support costs
Why do you need this cover?
- Complete Flexibility: You decide how the money is used. Whether it’s medical treatment, home modifications (like mobility aids), or simply maintaining your lifestyle, the funds are yours with no spending restrictions.
- Support for Your Recovery: Use the payout to fund private healthcare, rehabilitation, or adaptive equipment, enabling you to access the best available care quickly and comfortably.
- Maintain Your Standard of Living: Avoid dipping into long-term savings or retirement funds. This cover provides a financial cushion so you can stay in control during a difficult time.
- Tax-Free Lump Sum: The benefit is usually tax-free, allowing you to keep the entire payout without additional deductions.
- Built-In Peace of Mind: Having critical illness protection provides emotional security, knowing you and your family are financially safeguarded against the unexpected.
Extra Services Included
Many of our providers offer:
- 24/7 virtual GP access
- Mental well-being and counselling services
- Medical second opinions
These benefits are available from the first day of your policy.
Children’s Critical Illness Protection
Most plans include cover for your children at no extra cost, helping with treatment costs or time off work if your child becomes seriously ill.
Combine With Life Insurance for Full Protection
Critical illness insurance complements life insurance to provide a comprehensive safety net. Life insurance provides a payout upon death, while critical illness cover provides funds upon diagnosis of a serious illness, giving you protection in life and beyond.
For full protection planning, it’s worth comparing this with income protection insurance to see which suits your lifestyle best.
Tip: Looking for independent advice? Visit Citizens Advice for guidance on critical illness and financial protection.
Understanding the Types of Critical Illness Cover
Critical illness cover comes in several forms, each tailored to suit different financial goals and protection needs. While all policies typically include major illnesses such as cancer, heart attacks, and strokes, the full list of covered conditions and how they’re defined can vary depending on the insurer.
Policy Types Based on Payout Structure
The main difference between types of critical illness cover lies in how the payout amount behaves over time. Here’s how each option works:
Level Term Critical Illness Cover
This policy provides a fixed payout throughout the agreed term. Whether it’s used to cover ongoing household expenses, rent, or an interest-only mortgage, the sum assured remains unchanged. It’s ideal for those who want reliable coverage that doesn’t decrease in value over time.
Decreasing Term (Mortgage Critical Illness Cover)
Also known as mortgage critical illness cover, this type reduces in value over time and is typically aligned with a capital-repayment mortgage. It’s designed to cover outstanding mortgage balances, and because payouts decrease as your mortgage balance does, premiums are usually more affordable than with level cover.
Want to protect your home loan? Learn more about our Decreasing Term Life Insurance.
Increasing Cover (Inflation-Protected)
This optional upgrade adjusts your cover amount annually, typically in line with the Retail Prices Index (RPI). While monthly premiums may rise, your policy will keep pace with inflation, protecting the real-world value of your payout over time.
Need guidance on choosing inflation protection? Contact our advisers for tailored support.
Mortgage Advice..
Thinking of getting a mortgage? Our experienced team of skilled mortgage advisers are here to offer the essential guidance you require. Relying on our comprehensive understanding of the mortgage market, we’ll ensure you secure the perfect mortgage to suit your specific situation.
Income Protection vs Critical Illness
When it comes to protecting your finances against unexpected health challenges, income protection and critical illness cover offer two powerful, yet distinct, safety nets. Both types of mortgage protection insurance provide financial support if your health is impacted, but they operate differently and serve unique purposes.
Income Protection Insurance offers a regular monthly payout if you’re unable to work due to most illnesses or injuries, including long-term mental health conditions or musculoskeletal problems. In contrast, Critical Illness Cover provides a one-off, tax-free lump sum upon the diagnosis of a specified serious illness, such as cancer, stroke, or a heart attack.
These two types of cover are often confused, but understanding their differences can help you choose the right protection for your lifestyle, income, and mortgage needs.
Which Protection Is Right for You?
If you want to ensure your monthly mortgage repayments are covered while you recover from illness, Income Protection may provide greater peace of mind. On the other hand, Critical Illness Cover provides a lump sum you can use however you choose, whether to pay down debt, fund medical treatment, or cover essential expenses.
Speak to a Mortgage Protection Specialist
Choosing the right cover doesn’t have to be complicated. Our experienced advisors can help you compare options and tailor protection to your situation. Contact Connect Mortgages today for expert, FCA-regulated advice that puts your wellbeing first.
Key Differences Between Income Protection and Critical Illness Cover
| Feature | Income Protection | Critical Illness Cover |
|---|---|---|
| Payout Structure | Monthly payments (typically 50–70% of your income) if you’re signed off work. | One-time lump sum payment after diagnosis of a covered critical illness. |
| Conditions Covered | Broad coverage for any illness or injury preventing work, including stress, back pain, and fatigue. | Covers specific life-threatening illnesses listed in the policy, often with severity requirements. |
| Claim Frequency | You can claim more than once over the policy term if you recover and then fall ill again. | Pays once only. After the payout, the policy ends. |
| Waiting Period | Deferred period (e.g. 4, 13, or 26 weeks) before payments begin can be aligned with employer sick pay. | Payout is typically made after diagnosis and a survival period (e.g. 14 days). |
| Cost | Premiums are usually higher due to longer-term payouts and broader coverage. | Often more affordable, but the benefits are more limited and fixed. |
FAQs: Critical Illness Cover
Most frequent questions and answers about critical illness cover
Whether critical illness coverage is worth, it depends on your circumstances. The benefits of having such a policy can be significant, as it provides financial security in case of severe illness and can pay out an agreed amount to help with medical expenses, lost earnings, and other costs associated with recovery. However, the premiums for these policies can be expensive and may only suit some people’s budgets. Ultimately, weighing the potential benefits against the cost is crucial before taking out a policy.
Most critical illness insurance policies cover some or all of the following forms of cancer: breast cancer, prostate cancer, colorectal cancer, ovarian cancer, bladder cancer, lymphoma, and melanoma. The policy will cover any form of cancer listed in their policy documents. Review your policy thoroughly to ensure you understand what is and isn’t covered.
Yes, it is possible to buy critical illness cover on its own. It can be offered as a stand-alone policy or as an add-on to a life insurance policy. However, before making a policy, you should read all the terms and conditions to ensure it meets your needs and budget.
No, critical illness coverage is not a P11D benefit. P11D benefits are those provided by an employer exempt from tax and national insurance contributions. These typically include company cars, health care plans, and interest-free loans. In addition, critical illness coverage can be taken out independently or as an add-on to a life insurance policy.
Generally, no. Critical illness cover is designed to provide financial protection against the likelihood of being diagnosed with a critical illness. As such, it cannot be purchased after diagnosis and will not cover any existing conditions you have.
It depends on the insurance provider’s terms and conditions and the severity of your diabetes. Some providers may offer critical illness coverage for people with diabetes, though the premiums may be higher for those without the condition.
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Liz Syms is the CEO and Founder of Connect Mortgages and Connect for Intermediaries, a leading firm specialising in property investment finance. With more than 25 years of experience in the mortgage and financial services industry, Liz has helped thousands of clients secure both residential homes and investment properties.
Renowned for her expertise and commitment to excellence, Liz is passionate about delivering tailored, high-quality advice on mortgages and protection. Her leadership has positioned her as a trusted figure in the sector, and under her guidance, Connect Mortgages has expanded to a national team of over 300 advisers.
Driven by a vision to make Connect Mortgages one of the UK’s most successful mortgage networks, Liz continues to champion professional standards and client-focused solutions across the industry.
About the Author
Liz Syms is the CEO and Founder of Connect Mortgages, a specialist in finance for property investment. With over 25 years of experience in mortgages and financial services, Liz has helped countless people get their dream homes and investment properties. She is passionate about giving her clients the best advice possible when it comes to financial decisions relating to mortgages and protection and is dedicated to providing the highest quality of service. With her wealth of knowledge in the industry, Liz is a respected leader in mortgages and financial services and has grown her team to over 300 advisers nationally. She strives to make Connect Mortgages one of the most successful companies in its field.