Accident, Sickness and Critical Illness Insurance Explained

eg_travicon_28Nobody likes to think that they will be unable to work due to accident or ill-health, but according to the Office for National Statistics more than 2 million people are signed-off work every year in the UK.

The economy is recovering slowly, but wages haven’t yet caught-up with outgoings, and family budgets remain tight. In fact, a recent report by Shelter found that nearly four million households would struggle to meet housing costs if they missed a month’s salary.

Accident and Sickness Insurance provides an affordable financial safety net if the worst happens, but with so many different products to choose from it can be difficult knowing where to begin:

Personal Accident Insurance: Affordable cover providing financial help if you suffer an injury or death. Flexible policies mean that you select the level of benefit, which in-turn determines the cost of monthly premiums. Personal Accident Insurance is typically available to anyone aged 18-69 and applicants do not normally require a medical.

Sickness Insurance: Designed to help you cope financially if you are unable to work due to illness. Statutory Sick Pay and government benefits are unlikely to meet household expenses and Sickness Insurance can help bridge the financial gap by providing a monthly tax-free sum. Payouts are typically limited to 12 months and cover is often sold alongside Personal Accident Insurance.

Critical Illness Insurance: Provides a lump sum if the policyholder is diagnosed with a critical illness. Illnesses covered vary depending on the provider, but typically include: cancer, heart disease and strokes. Critical Illness Insurance is not to be confused with Medical Insurance, which is designed to cover the cost of treatment. It’s worth noting that failure to declare any previous medical condition (no matter how seemingly trivial) could result in claims being rejected.

All the policies above are designed to complement each other, and it’s important to understand that they provide very different types of cover. For example: payments for Sickness Insurance typically finish when you return to work, whereas Critical Illness Insurance is a one-off payment. Personal Accident Insurance provides ongoing payments (until you return to work) and a lump-sum in the event of disability.

To find out more about Accident, Sickness and Critical Illness Insurance visit Quoteline Direct


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