Family Income Benefit with Critical Illness Cover
How important is it?
In January 2019, Cover Magazine published an article called ‘Macmillan Cancer Support: How insurers can help’; and it opens with the following statistic:
“According to Macmillan research, around 83% of people diagnosed with cancer experience a financial impact, and these people are on average £570 a month worse off. This is often caused by a combination of reduced income, as many people need to stop working during treatment, as well as increased costs attending hospital appointments, such as parking or transport, additional childcare costs, and spiralling household bills.” – Alasdair Watt, Financial Programme Manager, Macmillan Cancer Support.
This is quite startling.
With so many people being affected, what options are available?
One Possible Solution.
Family Income Benefit with Critical Illness Cover provides you with a monthly benefit if you suffer an illness which is defined in the policy.
The advantage of this policy is that you receive a payout each month which you can use to pay for these additional costs. This can be in addition to an Income Protection claim and you can opt for a lump sum benefit upon a claim.
The Cost of Critical Illness Cover – examples
As of 16th May 2019, if you were a 40-year-old non-smoker looking for critical illness cover (with life cover) for the next 28 years (or state retirement age) to cover the additional costs as quoted by Macmillan, then your policy would need to pay either £570 per month upon claim or the equivalent £191,520 as a lump sum, here are the options:
- Indexed Level Term Lump Sum is best priced with Zurich at £94.94 per month.
- Decreasing Term Assurance with an assumed interest rate of 8% is best priced with Legal & General at £65.22 per month.
- Indexed Level Term Family Income Benefit is best priced with Aegon at £39.96 per month.
So as you can see a Family Income Benefit with Critical Illness Cover is a cost-effective way to pay for these additional costs that occur, leaving you to focus on getting better. And when you are better, and no longer have these additional costs to pay, you can take the rest of your insurance benefit as a lump sum.