income protection or critical illness cover?

[Hotpotatofood]

I am the main earner in a house: have 2 kids under 5 + mortgage. is it worth considering income protection or critical illness? I know that the job offers in-service death payout of 100,000. but what is I get really ill? is it better income protection or critical illness cover?

Critical illness tends to pay out for specified illnesses only rather than you being incapacitated in general. Make sure you know what you're buying as well. Income protection pay-outs often don't kick in until you've been out of work for several months by which stage you may have another job or already be in financial difficulty.

How long will your company pay you for if you are off sick?

IMO both these policies are very expensive compared to the level of actual risk and there are lots of situations when you might not be able to work, but which wouldn't be covered.

My preference would be to aim to have six month's bills in savings, which I appreciate is not possible for everyone, but we can all work towards it

in case of sickness my company will pay 18 weeks full salary and then 18 weeks half salary. do I understand it right that income protection policy will only pay during 12 months?

depends on the policy - they are hedged around with small print and need to be carefully studied.

I would second that you are better 'self-insuring'; savings, investments etc etc. Give this high priority if at all possible. Then if (hope not) you get ill there's no arguing about whether it will pay out, and if you don't you have the money.

life insurance is cheap which is why your company offers it.