Serious illness insurance pays out a tax-free lump sum if you are diagnosed with one of the specific illnesses or disabilities that your policy covers. It is also sometimes called 'critical illness cover'. It is often sold as an extra benefit on a life insurance or mortgage protection policy.

You may want to consider serious illness insurance if:

• you have no other cover for ill health.
• you are not in paid employment, so cannot buy income protection insurance.
• you have a mortgage, personal loans or other debts that you would still have to pay even if you became seriously ill and possibly unable to earn an income.

It is important to realise, when you consider this type of cover, that it would not replace your income if you were out of work because of a long-term illness. This is because some illnesses may be serious enough to prevent you from working full-time but are not covered by serious illness policies. Even where the illness is covered, the policy pays a once-off lump sum and not an ongoing income.

• You can claim the benefit on your policy only if:

the illness you develop is one of the illnesses your policy covers at the time of your claim, a medical diagnosis confirms that your illness matches the definition of that illness outlined by the insurance company in your policy terms and conditions, and you survive for a period after you are diagnosed. This period may be seven or fourteen days, depending on the policy.

You must meet all three conditions to claim your policy benefit.

There are many situations where you may not be covered by your serious illness policy. You will not usually be covered if:

• your illness was judged to be caused by drug or alcohol abuse, a self-inflicted injury or your failure to follow medical advice.
• your illness existed before you applied for insurance and you failed to say this in your application.
• your illness arose because you were involved in dangerous or criminal activities.
• you live outside the ‘territorial limits' of the policy for a certain number of months of the year. The territorial limits may vary from policy to policy but would usually mean all EU countries.

What is covered in a typical serious illness policy?

Policies vary, but they usually include:

• cover for a number of serious illnesses, listed on your policy, which may include permanent total disablement.
• limited serious illness cover for your children.
• waiting list and overseas surgery benefit.

The list of illnesses covered varies from company to company, but usually includes:

• stroke and heart attack.
• some types of cancer.
• coronary artery disease.
• multiple sclerosis.
• kidney failure.
• motor neurone disease.
• blindness.
• a benign brain tumour.
• severe burns.

Not all policies will cover all the illnesses listed above, or common illness such as angina, back injury and treatable cancers, so check with the provider for details of the illnesses covered before you take out a policy.

1. Permanent total disablement (PTD) is sometimes included in these policies. So, if you become permanently and totally disabled from an illness or condition that is not otherwise covered by the policy, you could claim the serious illness benefit.

There are two types of PTD cover.

• Any-occupation PTD - Any-occupation PTD means you can only claim if you are not able to work at any job. It means you are permanently unable to do many normal daily activities such as walking, lifting, bending, writing or speaking. The risk of claiming for this type of severe disability is low, so it is often included in the standard illness list.
• Own-occupation PTD - Own-occupation PTD means you can claim if you are permanently and totally unable to do your own job. The risk of a claim is higher, so you can expect to pay an extra premium for this type of PTD cover. You may not be able to get this extra cover if your job carries a higher risk of disability, for example, if you are a sports professional.

2. Children's serious illnesses - Your children may be covered for most of the serious illnesses listed on your policy, and sometimes for other child-related illnesses, such as meningitis. The maximum benefit for a child's claim depends on the policy, but it is usually no more than 50% of your cover up to a maximum of about €15,000.

3. Waiting list and overseas surgery benefit - This means they pay out part of the serious illness benefit if you are put on a waiting list for certain major types of surgery or if it is essential for you to have major surgery outside of Ireland.

How much does it cost?
For any given amount of cover, serious illness insurance costs more than life insurance. That is because the risk of you getting a serious illness during a given period is higher than the risk of you dying during the same period. The monthly cost of the insurance depends on many factors, but the most important are:

• the sum assured.
• who the insurance will cover - it could be single cover for yourself or joint cover for yourself and your partner.
• the term of the policy.

Your age, gender, health and family medical history also affect how much you pay for your serious illness insurance. One of the most common ways to buy serious illness cover is to include it as an extra benefit on a life insurance policy or a mortgage protection policy.

We offer Serious Illness cover on two different bases -

Accelerated Cover or Independent Cover.

Accelerated – Life Insurance cover with attaching Serious Illness Cover under the one policy. A serious Illness claim payment reduces your remaining life cover by that amount i.e. advance payment of Life Cover.

Independent – Serious Illness Cover without any life cover attaching

Other Products:
Term life insurance
Mortgage Protection
Optional extra’s – Indexation and Conversions