Combined insurance: Are you covered?

3 protection products to help you protect your family if the worst should happen

It can be possible to get combined Life Insurance and Critical Illness Cover (CIC), for less than the cost of two individual policies – but check the small print as these policies can also be more restrictive. If you don’t want to be left without cover at the very moment when you need support, read on.

In this third and final instalment in our ‘Are you covered?’ series we’re going to talk about Combined insurance, what it is and what to look out for to make sure that you’re not left without cover when you need it most.

What is Combined insurance?

Combined Life insurance and CIC policies are designed to cover you if you become critically ill (on diagnosis of a specified illness), or if you pass away (providing a lump sum to your beneficiaries). These policies may be cheaper – but there are disadvantages.

Some combined insurance products are designed to pay out a lump sum if you die or if you get a critical illness – not both. This would mean that if you made a claim for critical illness your life insurance cover would end.

If you’re tempted by cheaper combined insurance, you’re not alone. 65% of people said that they have not bought life insurance, or more cover, because they feel it is too expensive, according to the 2015 Insurance Barometer Study from Life Happens and LIMRA. And, according to this study, cost one of the top considerations in buying insurance, so let’s talk about it.

How much will this cost?

8 in 10 people overestimate the cost of Life insurance, and if there were a rule as to how much your insurance will cost then its probably ‘the younger and healthier you are, they lower your premium is likely to be’. The price of insurance products linked to your health will depend on a number of factors such as your age, gender, whether you’re a smoker, your medical history, history of illness in your family, whether you want to also cover other members of your family etc. It’s all subjective, and different insurers have different rules. Some may ignore family history, some will not. Only by comparing quotes can you find the best deal for you.

What’s included in my policy?

When looking at a quote for Life or CIC, take a good look at what illnesses your policy would include. Your CIC policy may list ‘cancer’ under the list of illnesses covered, but you may find that not all cancer diagnoses will be covered, as this can depend on the severity of the cancer. As cancer accounted for 28.5% of all deaths registered in 2016, it’s important to pay close attention to what is covered when comparing policy quotes.

Asking for help from a financial adviser

7 in 10 want to talk to someone about their life insurance needs, but 5 in 10 said they don’t like thinking about death. If you feel this way, then making an appointment with a financial advisor will mean you don’t have to make these decisions alone. You’ll be able to talk about how you can plan to protect and provide for your dependants with your adviser, and your spouse too. If you like, you could even organise a meeting with your adviser and invite your dependants – so that they can gain a greater understanding of what’s being put in place.

All names have been changed in order to protect the individuals, but are real examples of how our advisers have helped our clients.

https://www.ons.gov.uk/peoplepopulationandcommunity/birthsdeathsandmarriages/deaths/bulletins/deathsregistrationsummarytables/2016

http://www.lifehappens.org/wp-content/uploads/2017/10/Infographic_NoMoreExcuses_2017_10.5.jpghttps://www.lifehappens.org/industry-resources/2015barometer/

https://www.confused.com/home-and-lifestyle/life-insurance/whole-life-cover-a-simple-guidehttps://www.moneyadviceservice.org.uk/en/articles/securing-your-financial-future

https://www.nerdwallet.com/blog/insurance/what-is-the-difference-between-term-whole-life-insurance/