A critical illness can have a serious impact on both your own life and the lives of your children, spouse or partner. So it is important to ensure that you financially protect yourself and your family.
It’s easy to think that you’ll never be diagnosed with a critical illness, particularly when you feel healthy and energetic, but any one of us could fall ill with very little warning. It makes sense therefore to protect yourself and your family from the financial fallout as best you can.
According to research from Scottish Widows, a fifth of the population admit that their household would not be financially secure for any length of time if it lost its main income through unforeseen circumstances. And more than a third would resort to accessing their savings if they were unable to work. Despite this, however, only 32% of people have life insurance, and just one in ten have taken out critical illness cover.
During 2015 almost two thirds (63%) of all critical illness claims to Scottish Widows were due to cancer. They paid out almost £4.5 million in claims relating to prostate cancer, ovarian cancer and brain tumours during that year – some of the most commonly diagnosed conditions among middle-aged men and women.
Avoid having to borrow money as a result of critical illness
A report by Macmillan Cancer Support revealed that thousands of middle-aged people in the UK are being forced to borrow money from their parents because of the cost of having cancer. Macmillan estimates that more than 30,000 people with cancer in their 40s have borrowed money from their elderly parents, and more than 2,000 have moved in with their parents or parents-in-law after having to sell their house. The charity says that 28% of people with cancer of all age groups – an estimated 700,000 individuals – are vulnerable too because they have no savings to fall back on. And for 83% of cancer patients, lost income and increased expenditure brought about by the disease costs them an average of £570 a month.
Safeguard your financial future and well-being
It is important to take time to consider the arrangements or financial resources available to you for those ‘what if…’ and ‘how would we..’ scenarios to help ensure provision is in place to help you deal with the unexpected.
Critical illness cover pays out a tax-free lump sum if, during the term that you select, you are diagnosed with one of the specified conditions covered by the policy. It’s entirely up to you how you choose to spend the money, but you could use it to pay off your mortgage or other debts, maybe a holiday to help you recuperate, or for home modifications such as building ramps or widening doorways for wheelchair access.