Life /Critical Illness Insurance Advice Please

[mummytippy]

Hi all

I'm in good health but am currently taking stock of my finances and something I don't currently have is Life Insurance. The pets have insurance though!

I'm a lone parent, employed, with a 12 yo DS.
I rent my property and have a few financial commitments... eg loans etc.

My question is... should I take critical illness cover in addition on a policy for life insurance... or just take out Life Insurance?

I've looked on Martin Lewis's website and they say for 'rule of thumb to insure yourself for 10 x your annual salary and for the number of year your child will be financially dependant for.

Based on this I was considering a figure of £200k and making the level term 10 years (as my DS would be 23 by then).

I'm a bit confused by the critical illness element as I'd like to know that he'd be financially secure whether I'm critically ill or pass away... any advice would be most welcome.

I'm currently looking at the policy with Legal and General through Cavendish Online. Don't really want to phone them as hate the hard-sell.

Thank you in advance.

Life insurance is for your children after you die, and critical illness insurance will pay you a certain amount if you are diagnosed with a serious condition- so you can argue it's for you.
They are different and nobody will tell you which one to take. Depends how much you can afford per month for example. Life is much cheaper than CI so you'll need to consider that.
Your estimate of 200k for 10 years seems reasonable as you don't have a mortgage and your child is 13.
As for CI, you would need to try to work out how much money would be enough if you were unable to work for a long period or even permanently - take into account sick pay and benefits and try to come up with a figure.
I took CI 12 years ago for 150k (a bit of a guess based on a 200k mortgage which half belongs to me and an extra 50k for other expenses)- last year I was diagnosed with cancer and it paid out straight away so I'm very relieved I did it.
Hope that helps. Good luck.

I took out critical illness cover through a work scheme and bought cover of £25k. A couple of months ago I got an out of the blue breast cancer diagnosis and just heard today they’re paying out. Obviously that’s great and not to be sniffed at - but I kind of wish I’d bought more cover given what’s happened! I would certainly suggest you get some, Dulce’s advice is good.

It's more expensive to add Critical illness, but life insurance only pays on death. If you were unable to work how would your finances look? As a lone parent I would say it's money well spent if you can afford it.

Thank you for all your comments and advice. Sorry to hear of your diagnosis Dulce and Brassica.

You sound like you're in the industry Dulce.

I'm going to go back into my quote... I'm now thinking definitely Critical Illness too... just not sure on the figure... maybe a similar amount to the Life cover?

Well I turns out I couldn't get cover. When going through the questions I confirmed I have a colposcopy in 3 weeks time... referred after my smear 2 weeks ago. As I answered referred to hospital doctor (although it's a clinic) within the next 4 weeks I was declined cover but they said I can apply again in 3 months.
Thanks for your time everyone.

I got critical illness cover for myself & then husband when I bought a house, bought house 2010 & end of 2003 then husband diagnosed with MS, critical illness policy paid out in full within 2 weeks. Money was same value as mortgage but as I was on maternity leave we used some to enable me to stay at home longer until husband had improved enough to be able to care for ds when I was at work, We also got all the jobs that needed to be done on the house sorted & paid off a bank loan I had to reduce outgoings. The balance we paid off the mortgage to make it easier financially for me to return to work p/t as had been planned before husband's diagnosis. I was really against taking out the insurance when the mortgage advisor brought it up, but was glad that we took it out.

Thanks for your comment Nat.

I've telephoned the Insurance to give more detail as to what the referral is for and they've said the same thing. Go back to them after the referral.

Thanks again everyone... I guess I should have sorted my own insurance before the pets.

Yes you have to be in good health with no pending tests or referrals before they will quote. We have neither but we also don't have children. Pets come first lol - my cat is unsured!

We are currently having a battle with Legal & General over DH's life insurance, our policy states they will pay out if a terminal diagnosis of less than 12 months is given. Dh (39) has been given less than that due to bowel cancer and they are fighting us to pay out. McMillan are now involved with their legal team.

So I would steer clear of them....

That’s disgusting, hope you get it sorted soon Loubie