21/12/2018 0 Comments
How to prepare financially for long-term illness
While British life expectancy continues to rise, the same might not be said for the quality of health we could expect to enjoy as we get older, according to a stark warning from The British Heart Foundation. Their analysis suggests the number of people suffering heart attacks and stroke because of a rise in diabetes diagnoses could rise by 29% over the next two decades.
While this could be blamed on worsening lifestyles and a growing obesity problem, demographic changes such as an ageing population mean the number of people with chronic or long-term conditions is also likely to increase. This puts extra strain on the NHS as it tries to keep pace with society while managing the cost pressures this inevitably puts on our health and care system.
And it’s not just the NHS that has to foot the bill when it comes to treating ill health. Ask yourself, how would your family cope if they couldn’t rely on your income for a long period of time? Could they sustain their hard-earned lifestyle if you were to die suddenly?
All the same, it won’t happen to me…
Unfortunately, the reality of suffering a serious illness or dying suddenly suggests otherwise:
- 1 in 2 people in the UK will be diagnosed with cancer in their lifetime
- Every five minutes someone suffers a stroke in the UK
- Around 42,000 people under the age of 75 in the UK die from cardiovascular disease every year
Critical illness cover or life insurance may not sound like priorities for you, but the financial buffer they can provide at such a difficult time could be invaluable.
Appropriate protection, such as life or critical illness cover (written in trust) can help you, your business partners or your loved ones avoid financial difficulty at an already traumatic time.
There are three main types of cover that can be invaluable in this situation:
- Income protection or permanent health insurance, will give you a small salary if you cannot work, which will last until you return to work, retire, die or the policy ends.
- Critical illness insurance will pay you a tax-free lump sum on the diagnosis of a range of serious (but not fatal) conditions including heart attack or stroke.
- Health insurance also called private medical insurance, will pay out for the cost of medical treatment required for an illness or injury.
But insurers never pay out?
If you're put off buying protection because you don't think it will pay out when you need it, think again. According to the Association of British Insurers £5bn was paid out on protection claims in 2017, the equivalent of 98% of all protection claims received during the year.
For more information on how an insurance policy could help you and your family if you were hit with a long-term illness, please get in touch.