Small print of terms and conditions of insurance companies:
Be careful regarding the terms and conditions that insurance companies have on their plans. If you come to claim on a critical illness plan you’ll find that companies are well protected by the small print they have. That is too late of course to enter into discussions regarding what you thought you had. Let me give you a few examples so you know what I mean. I’ll cover total and permanent disability (TPD) – claiming if you cannot return to work, and cancer – the biggest cause for claims on a critical illness plan.
The definition on TPD comes in a few guises. If you thought you were unable to work you would think you could claim – very wrong. The best definition you could have is ‘ unable to do your own occupation ‘ which pays out if you cannot do your own occupation! – Straightforward. More commonly you will see the following: ‘Unable to do your own occupation or any other’ or ‘any other for which suited’. Lastly the howler above all others is ‘work task definition’ i.e. able to dress unaided walk upstairs etc. Few plans that I see actually cover the very first ‘own occupation’ definition. This is common and is one method of making the monthly premium look cheaper, but of course you don’t have the cover you expect, so check it out.
Breast cancer is the most common cause of cancer in women with 40,790 diagnosed each year and prostate is the most commonly diagnosed cancer every year with 30,140 cases each year. Interestingly Skandia life pointed out that 70% of their prostate claims where for Gleason scores of 6 or less which are referred to as low grade prostate cancers. It may be worth your while knowing that since May 2003 low grade prostate cancer has been removed from the ABI’s cancer definition so if you have a plan that simply complies to that you will find you are not covered.
Skandia points out that 59% of their female cancer claims are for breast cancer. As far as breast cancer is concerned Ductal carcinoma in situ (DCIS) is also excluded from the ABI cancer definition, so you would not be able to claim if your plan just had that definition. However for many women to ensure that DCIS does not develop into full blown invasive breast cancer they may be advised to have one or more breasts removed. Some companies have low-grade prostate cancer benefit in their plan and also have a mastectomy benefit for DCIS included at no extra cost although they do pay a restricted amount of cover.
Skandia point out that 58% of their claims are for cancer but the next two are for heart attack (15%) and heart surgery (8%). Only a few companies actually cover for balloon angioplasty yet over 2500 thousand angioplasties are carried out each year in the UK (british heart foundation 2004). 23% of skandia’s claims for heart surgery were actually for angioplasty.
These are just a number of the conditions and there are many more e.g. when is a heart attack not a heart attack – surely when your doctor says you’ve had one is good enough? Evidently not! Some insist that there has to be evidence of chest pains! I don’t expect that you will want to rummage through the policy you have to check this all out but it is better to check it now than later. If you don’t have the time ask an Independent Financial Adviser (IFA) to do it for you and you’ll go some way toward peace of mind.
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