A Critical Illness Review Site

Critical illness insurance schemes can becomes viable only when both marriage partners are fairly old, aged over 70 at least. For single people the scheme may be viable at younger ages, but again it has to be remembered that women tend to contract critical illnesses later and get less favourable annuity rates, so that women aged under 70 will not find this type of scheme of much use in increasing their income. Terms and conditions offered by the offices involved in this scheme vary and it is well worth “shopping around”.

The deferred annuity has already been seen in personal pension plans. The deferred annuity is payable at some date, and may be purchased either by regular premiums or by a single payment. The rate of future income payable under a deferred annuity is normally fixed at the time of purchase. The buyer therefore stands to lose if interest rates are higher at the time when the annuity becomes payable than they were when he made the purchase of the critical illness insurance plan. The converse also applies, since if interest rates are lower when the annuity becomes payable he will have acquired a higher rate of income through the deferred annuity than he could obtain at the time with an immediate annuity.

However, the policyholder generally has the option of taking a cash sum in lieu of the guaranteed payment and he may use this to buy an immediate annuity at the best rates available in the market. However, taking a cash sum in these circum­stances can produce a tax liability. Deferred annuities are little used by themselves, though they do form one element in the single-premium investments. Another rare type of annuity is the reversionary annuity.

Here, the payments start upon the claim of a named person and are payable to another named person throughout their life. They were used by husbands to provide an income for their wives after the occurrence of critical illness but today are not very common, since critical illness insurance is more effective.

The funds are designed along unit trust lines in that they are divided into units each representing an equal proportion of the fund’s assets, and are valued at regular intervals with unit prices adjusted to these valuations. The purchase of a block of units can be made only through the medium of a critical illness insurance policy; in fact, in making such a purchase, the investor does not become the legal owner of the units (as he does when buying unit trust units) but of a policy whose legal form is a claim against a critical illness insurance company. Since the sum assured on the policy is, for the older lives, slightly more than the premium paid, the critical illness claim risk for the company is minimal, and what the investor is really interested in is the investment and tax benefits of the fund he chooses.  

The property fund invests in commercial, industrial and occasionally agricultural property and land. Normal offices, shops and factory or warehouse buildings form the bulk of the portfolio of investments, but some funds also them­selves undertake small developments, that is, they buy a site, arrange finance, erect and finally let a building, in the hope of establishing a value in excess of the costs involved. One fund may, for example, have invested heavily in offices which are currently yielding a relatively low return by way of rentals but which are mostly due for rent reviews within a short period, at which time a substantial.

Increase in rents might be expected, which would increase the capital value of the properties. Another might have a large proportion of its money invested in “rack­rented” shops in High Streets up and down the country, where the level of rents chargeable is very closely related to the current state of retail spending by consumers. The actual “mix” of types of property in the fund, and facts such as whether a few single properties account for a large proportion of the money invested, can have considerable impact on the performance of the fund.

The purpose of critical illness insurance is that it protects your life against diseases such as cancer, stroke and heart attack among other ailments. Put in other words, critical illness insurance has the ability to provide you with a tax free lump sum which will allow you to find treatment and hopefully get back to normal. This explains the difference of critical illness insurance from life insurance, which pays your beneficiaries out when you pass away. Critical illness insurance can give you enough money to cope with a loss of income. At the same time it can as well help you when you are affected either physically or mentally due to severe illnesses.

Critical illness insurance will pay you a cash lump sum when you claim for a disease that appears and fits correctly in the definitions found in your policy. As soon as you make a claim, its legitimacy needs to be verified by your doctor. The appropriate definition and symptoms have to be confirmed by your doctor in order for your claim to be accepted. It is therefore crucial to become knowledgeable about critical illness insurance before you decide to buy it. In case you already have critical illness insurance or have just taken one, ensure to scan the whole policy documents carefully to look at definitions and exclusions. The fine print will be a good guide to help you have your payout when you mostly need it.

You should know that the amount of cover that you want will be decided when you sign on your contract papers, at the start of your policy. You may not change your coverage amount during the term of your policy. That is why; you need to make a good planning before your set out to buy critical illness insurance. You need to carefully calculate all your expenses at the end of the month and then see if you might be able to contribute more as premiums to obtain a higher coverage value. Buy critical illness insurance as you will need it.