Big Changes On The Horizon For Critical Illness Insurance

Big Changes On The Horizon For Critical Illness Insurance



Big Changes on​ the​ Horizon For Critical Illness Insurance.
In recent years sales of​ critical illness insurance have flagged .​
The primary cause is​ the​ huge 70% increase in​ premiums experienced during recent years .​
For many,​ critical illness insurance has simply priced itself out of​ the​ market .​
It's not that critical illness insurance is​ a​ bad idea .​
After all it​ pays out a​ lump sum if​ the​ policyholder is​ diagnosed with one of​ the​ many critical illnesses listed on​ the​ policy and the​ policyholder survives at​ least 28 days from diagnosis .​
(Note: some policies have a​ 14 day survival period.) Most policies have a​ huge list of​ insured illnesses although about 60% of​ claims are for cancer – not surprising,​ as​ 1 in​ every 3 people will develop cancer sometime in​ their lifetime .​
In fact when you​ look at​ the​ concept of​ Critical illness insurance you​ can easily make a​ case that everyone living on​ earned income should have a​ policy .​
It's designed to​ give you​ a​ pot of​ capital to​ live on​ if​ serious illness prevents you​ from working normally .​
Premiums have increased dramatically because medical advances have meant that many illnesses that proved fatal in​ the​ past are becoming quicker to​ detect and easier to​ treat .​
Hence insurance companies have found themselves paying out earlier on​ claims and on​ illnesses which are not necessarily debilitating - which was the​ original purpose of​ critical illness insurance .​
To give you​ a​ better idea of​ the​ sort of​ illnesses we're talking about,​ here's a​ typical list:
Alzheimer's Disease
Aorta Graft surgery
Bacterial Meningitis
Blindness
Brain Tumour
Cancer
CJD
Coma
Coronary Artery by-pass surgery
Coronary Artery Angioplasty
Deafness
Heart attack
Heart Valve replacement/repair
HIV/AIDS resulting from blood transfusion
Inability to​ perform your duties of​ occupation
Kidney failure
Leukaemia
Loss of​ limbs
Loss of​ speech
Major organ transplant
Motor Neuron diseases
Multiple Sclerosis
Occupational HIV/AIDS
Paralysis
Paraplegia
Parkinson's disease
Stroke
Third Degree burns
Any illness that results in​ Total and Permanent disability
Insurance companies have at​ last realised that they're not going to​ get anywhere marketing policies that people can't or​ won't afford,​ and where the​ companies can't afford to​ lower prices .​
So it​ now looks as​ if​ insurers such as​ Scottish Widows are considering a​ break through – splitting the​ cover so that the​ prospective policyholder can specify which illnesses he or​ she wants to​ insure against .​
It's a​ form of​ menu pricing – cover for each illness would have a​ price and you​ simply select which illnesses you​ want to​ insure against .​
Whether such insurance proves popular will very much depend on​ the​ cost .​
For example,​ if​ cancer accounts for around 60% of​ current claims,​ you'd expect the​ premium for covering cancer alone to​ be about 40% cheaper than a​ full strength critical illness policy .​
We'll have to​ wait and see .​
If you're interested to​ find out how much a​ standard critical illness policy would cost you,​ you'll find it​ cheapest on​ the​ Internet .​
The best sites to​ look out for are the​ independent discounting brokers who deal with all the​ big insurance providers .​
These brokers can search the​ whole market for you,​ come up with the​ cheapest insurer,​ and discount their price .​
Try to​ use a​ broker who'll also give you​ personal advice on​ the​ phone as​ some policies do vary in​ the​ scope of​ their cover.




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