In the second aricle on health insurance options when taking on a mortage, today we look at critical illness insurance. This insurance pays you a lump sum (a one off payment) if you are a victim of a limited number of critical illnesses. If you contract one of these critical illnesses, chances are that you will become unemployed due to it, and will not be able to make your monthly mortgage payments. This will either result in losing your home and/or property, or having to pay the extra fees for the delay in making your payments.
A critical illness cover will cover you for a limited number of illnesses. Therefore you should sit with an insurance broker and go through the entire contract before you buy one. Different insurance companies will cover different illnesses at different prices. The policy may also require the holder to survive a minimum number of days (survival period) after contracting the critical illness. This survival period also varies from company to company but is generally between 28 and 30 days. The number of illnesses covered by different companies may vary over time. For example, some illnesses that were covered a decade ago may not be covered today, because treatment may have gotten better over time or a cure devised. Also, illnesses that were deemed non-critical some time ago may not be listed as critical illnesses. Therefore you should continue to check with your insurance company and obtain a list of covered illnesses from time to time. You should also check if the premium increases over time, as the risk of you contracting such an illness becomes higher. That being said, critical illness insurance is still not the best insurance policy to protect you over health issues. You should also consider a permanent health insurance cover, which we covered previously this week and is far more comprehensive.