Summary
The means in which the severity of an illness can influence the pay out. How insurers are constructing new policies which suggest limited pay outs.
Learning that you have cancer is shattering news. At some time duringour lives, one in 4 of the population will get the disease. It is not surprising that PPP observed that of all illnesses, cancer causes Britons intense apprehension.
At this arduous time you would be expecting an immediate settlement by your health insurance company, allowing you to focus on getting better. Sadly you could get a big shock. Many cancer sufferers make a complete recovery with thanks to progression in medical science. Currently some cases are not even looked upon as severe, so it is frightening to find out that lots of medical and life insurance policies only pay up when your condition is life threatening or terminal. It’s the same for mortgage insurance.
An independent financial adviser, warns that people must not suppose that they will get a pay out just because they have been diagnosed with a severe condition. He warns people not to concentrate on the cost alone when taking out an insurance plan, but to read the Ts and Cs in a private medical or critical illness policy to ensure that the insurers will pay you when you really need it.
On the diagnosis of a specific condition, critical illness cover will pay out a lump sum. Whereas, you will get better quality and swiftness of treatment with private health/medical insurance. Such as, appropriate licensed treatments could be offered, which are not dispensed on the NHS. A spokesperson of independent advice firm LifeSearch says about 16 per cent of claims do not succeed on protection policies and at pay out for severe illnesses and diseases. On the other hand some cancers sound much worse than they are and in these cases you more than likely won’t get any money from traditional plans.
In the past life assurance companies had an all or nothing attitude, but they are now starting to offer plans with a partial or full payout. An illustration of this is Pru Protect, an alternative critical illness policy from the Prudential, which links the size of the settlement to the severity of the illness and how much anguish it will cause. This policy does not become invalid once a demand is made but subsequent pay outs may be reduced drastically. This feature is specifically important when the patient is diagnosed with a stage-one or stage-two cancer, which may become even more serious.
Recently the insurance industry addressed the vexed issue of customer non-disclosure. The Association of British Insurers has brokered a new agreement, which will allow claims effected by non-disclosure to receive a full or partial pay out, which has not been the case in the past.
