To not get critical illness cover?

[Rainraingoaway10]

Looking at updating our life insurance policies.

unsurprisingly the financial advisor is touting the need for critically illness cover too, but it’s a really expensive extra payment per month

is it common for people with kids to have this coverage? My job has v good sick leave policy

the advisor wasn’t steering us towards a particular provider

just emphasising that we should have it

If you can cover the mortgage and your outgoings easily enough on one salary and feel your kids would be well provided for regardless of your health/death, then I would think twice about the critical illness bit.

That's exactly what I'd expect then, surprised at your definition of sensible advice as touting

Entirely up to you and your circumstances whether you decide to take it out.

I suppose you just need to run through some (depressing!) scenarios; what if we both died, what if he did, what if I did, what if he did first then I got ill, what if he got ill then I did etc etc. Not a fun thing to do! If your outgoings are very low then I agree you shouldn't insure yourselves to the eyeballs (I'm surprised your quotes are so high if your mortgage is so low) and agree with the PP about keeping policies separate.

I know it’s up to me and my circumstances

Hence this thread asking people for their experiences and views (which are all very helpful, thank you)

And helpful to think about the separate policies too, thanks

One thing to remember is that critical illness policies often also give you a payout if your child gets a critical illness. My friend's toddler got cancer and the family has really struggled with money as one of them had to quit work and the other on reduced hours. A lump sum would be immensely helpful in that situation and we took critical illness cover out ourselves after that happened.

Statistically you're guaranteed to die

Not while still of working age

It depends on your circumstances. A relative is off work with cancer but they have paid off their mortgage and are entitled to enough disability benefits that they can manage financially. Do some scenario planning - know your essential outgoings and use the entitled to calculator to work out what you might get if one of you gets a critical illness. If it won’t be enough or you’d need extra to cover for example childcare, you probably need it.

But not with dependents

I am grateful that my Dh had taken it out when he was diagnosed with stage 4 cancer - it took away at least money worries whilst we focussed on his treatment. See it rather that you pay £150 monthly and if you never need it be thankful for then the worst did not happen and all you did was pay money - if the worst does happen it will very needed.

My circumstances are similar to yours in that we have relatively secure public sector jobs with excellent pensions, death in service and sick pay etc, but we personally have very little in the way of savings currently and a sizeable mortgage. If we were to get ill or die I want the other spouse and children to be able to maintain (in fact improve) on our current lifestyle so we have our insurance policies set up in that way, so for us that means needing CIC, IP and life (we have decreasing life covers for the mortgage, and separate life covers to cover the missing wage of the dead parent) we have separate policies so they can pay out twice (important if we die at the same time). The cover goes up until our youngest is 21 I think it is, possibly 23, setting a deadline can help keep insurance costs down rather than unnecessarily insuring us to pension age (we will only be late 40s when youngest comes of age), when the kids are raised we are on our own but should be much more financially secure by then (except the decreasing mortgage cover which is obviously for the full term).

@PiscesScot haha sorry yes very good point, as has been stated I meant during the time of your life you have a mortgage and/or dependents!

We do pay but not enough to cover us- on my list to try and up it.

basically the risk of getting seriously ill and not being able to work is far higher than the risk of death. And if my dh couldn’t earn (by far the biggest wage earner) we couldn’t keep up with the mortgage. At least when you have kids at home it’s worth paying IMO.

The question is always "can I afford not to have it?". With small children and a mortgage you need to look beyond a month or two off sick on full pay and think about what you'd do if, for example, one of you was in a serious accident or had an illness which were life changing and couldn't work again or for a much longer time.

I got it when I first got a mortgage. I'm now diagnosed with MS. Not getting an extended warranty for your TV is one thing. This is different. Please do it.

It's so expensive because combination of how high the risk is and how much money for how long time they would have to pay.

In financial sense is long serious illness worse then death for the family. The ill one doesn't work, but eats, lives, needs space, needs care and might need some home adjustments.

Thank you, this is really helpful!

If you have a low mortgage and good sick pay, you might be better off shopping round for a lower level of cover that covers more conditions.

Being ill long- term, or the knock-on effects of aggressive treatment is expensive - maybe going part time, retiring early, maybe your partner going part time to support you, costs of getting to hospital appointments, maybe can’t get train to work anymore, need more help around the home or move to somewhere better suited to (even just to move somewhere where you have a drive vs having to walk from parking the car up the road). If you can afford to give yourself some extra protection that’s sensible in my view. We certainly can’t rely on support from the state.

I pay £95pm for 20 years of joint life and CI cover to the end of my mortgage for a payment of £100k.

For me the CI was more important than the life cover as I have no dependents. But at the time I had a poor occupational sick pay policy, and don’t have any family - there would be nobody to ask for help, either financially or practically. I wanted the reassurance that the mortgage would be paid, and could pay a cleaner, or nurse, or whoever, to come in and help.

There is a lot of cancer in my family and it’s always terminal - I have nobody left. I also have PCOS which bumped the premium up as well as family history.

If/when I get cancer, I need to be able to put every effort into getting better, not worrying about money.

And if I don’t get ill I’ve paid out £24k over twenty years which I won’t get back, but I’ll still be alive, and when your mum died at 53, your dad at 63 and your sibling at 47, then that’s an achievement in my family.

Hahahaha!!! I know you don't mean it this way but... no! You are 100% guaranteed to die. You might not get ill (if you die by some kind of one-off-freak thing that involves no illness period).

But I do know what you mean- you're more likely to need cover for illness because you're more likely to get ill during the period of your mortgage than you are to die during it.

My mortgage was paid off when I had cancer even though it was caught at an early stage.
It’s one of the things that you have to work out if it’s worth the risk to you.

That seems expensive so I would shop around

We only have life cover until the youngest DC is 21, rather then unending

If you still can't afford both, I would do critical illness over life insurance. You are far more likely that one of you will get a critical illness before retiring than die

Our 160k cover (not decreasing) life insurance and critical illness for myself and DP is £130 p/m. First insurers quoted refused to cover due to my family history.

Wonder if you might be able to get the quote down at all. Your mortgage advisor will want the business, so benchmark and see what you can get yourself. Then ask him/her to match.

We aren't a high income family at all, so it's a lot to pay each month...but then that's why it's so important for us to have it. I personally wouldn't count sickness policy at work as a good enough cover.