Critical Illness Cover Basics
Understand the fundamentals of critical illness protection and how it differs from life cover.
What is Critical Illness Cover?
Critical illness cover pays a tax-free lump sum if you're diagnosed with a serious illness covered by your policy. Unlike life insurance, which pays out on death, CI cover provides financial support while the policyholder is still alive, helping them focus on recovery rather than finances.
Key Learning Points
- Definition triggers - how claims are assessed
- Core vs additional conditions - understanding policy scope
- Survival periods - the qualifying periods before a claim is valid
- Terminal illness benefit - accelerated benefit options
The Claims Process
When a client is diagnosed with a covered condition, the claim process begins. Medical evidence must support the diagnosis, and the condition must meet the policy's definition. Most insurers aim to pay valid claims within days of receiving all required documentation.
Understanding Definitions
Policy definitions are crucial. A diagnosis alone may not trigger a claim - the condition must meet specific criteria. For example, a cancer diagnosis must show malignancy and invasion of tissue. Always ensure clients understand their policy's definitions.