The Imperial Cancer Research Fund said in 1999 that one in three people in Britain will get cancer at some point in their lives. With fast medical progress, the chances of surviving a serious illness are getting better, but the effects of a serious illness are still big and can change your life.
Critical illness insurance is meant to help you deal with the changes you will have to make if you get a serious illness.
The Imperial Cancer Research Fund said in 1999 that one in three people in Britain will get cancer at some point in their lives. With fast medical progress, the chances of surviving a serious illness are getting better, but the effects of a serious illness are still big and can change your life.
Critical illness insurance is meant to help you handle the changes you'll have to make if you're diagnosed with a "qualifying medical condition." Most policies pay out if you get heart disease, cancer, a stroke, kidney failure, paralysis, a major organ transplant, or coronary artery bypass surgery, among other things. There is usually a one-time tax-free payment that is meant to help you pay for things like making changes to your home or car or retraining for a different job. This kind of insurance isn't just for the person who brings in the most money, and you should think about how much it would cost to care for the kids and clean the house if Mum got sick.
Unfortunately, when most people are still in shock after being told they have a serious illness, they and their families may get some more bad news. The latest numbers from the insurance industry show that, on average, about a quarter of all claims are turned down.
As soon as you file a claim, the insurance company will ask your doctor for a lot of information. It's likely that a lot of this information doesn't have anything to do with the illness that the claim is about. The insurance company is using this information to figure out if the insured was honest on the original application form.
This is because of what insurers call "non-disclosure." If any medical information was left out, they can use this as a reason to deny the claim.
It looks like not telling might not have anything to do with the critical illness. Claim forms have been turned down for many different reasons. For example, a woman with breast cancer was turned down because she didn't list treatment for depression on the original form.
The rates of rejection are shown below:
company's share of claims that were turned down
28 percent of the Scottish Equitable Project
26 % of Norwich Union
Friends Provident 25 percent
Legal and General 22 percent
Bupa 21.5 percent
Skandia 21 percent
Prudential 20 percent
20 % of Standard Life
18 percent of Scottish Widows
11 percent of the Scottish Provident
10 percent of the Scottish Equitable Guardian
Average 23.5 percent
Even though the insurance companies say that these rejections are legal, the Law Commission seems to disagree. In a recently released consultation document, the Commission says, "It is possible for an applicant to act honestly and in a reasonable way and still not meet the duty of disclosure." As soon as the results of these meetings are known, they will be reported on.
So, if you want this very valuable type of insurance, it is very important that you tell the company about any illnesses you've had in the past. If you have to make a claim, your medical records will probably be carefully looked over, and if the insurance company thinks you left out important medical information, they may "throw out" the request.
Compare prices to find the best deal. Read the details. Spend a lot of time making a list of medical conditions. Don't worry, it might never happen.
