As the pandemic all too clearly demonstrated, our health is even more important than our wealth.
But although health must come first, health and wealth affect each other. Obviously, you need to be in good health to bring in an income – but financial security can be vital for health. Stress affects physical as well as mental wellbeing, and financial worries are one of the main causes of stress for many of us.
Fortunately, there are ways to protect both health and wealth if things go wrong.
Private medical care
Most of us are entitled to free healthcare from the NHS. It remains the best solution for accident or emergency, but for many types of illness, it can mean long waiting lists and overcrowded wards.
Private medical care means faster access to a private room rather than a bed on a mixed ward, and you can choose your surgeon and hospital. It can mean getting back to full health faster, but of course, it is expensive. Private medical insurance can deal with the costs, with the most basic policies covering in-patient treatments while more comprehensive policies cover out-patient care, including visits to consultants.
Pre-existing conditions will not be covered, normal pregnancy and childbirth will be excluded, and so will organ transplants.
But private medical care is not the only type of health-related cover you might want to consider. If you are too ill to work it can mean financial problems for you and your family, particularly if you are the main breadwinner.
Cover also exists to provide an income if illness prevents you from working.
Financial cover if you become ill
There are several types of cover to consider.
Critical Illness Cover pays a tax-free lump sum if you are diagnosed with any of the illnesses listed in the policy, which usually include most cancers, heart attack and stroke. Like life insurance, it can be arranged at a level to pay off your mortgage and to provide a replacement income.
You can spend the money how you wish, so you could use it to pay off debts, to adapt your home to your particular needs, or simply to provide for the costs of everyday living while you were not well enough yourself.
Permanent Health Insurance or PHI works a little differently. This pays a proportion of your salary in the event of any illness or debilitating accident that stops you working permanently. These payments can continue until you reach your normal retirement age.
Accident, Sickness and Unemployment (ASU) cover. This can provide a replacement income in the event of illness, accident or redundancy for a maximum of 12 or 24 months.
What will it all cost?
Naturally, the cost of all these types of cover will depend on your age and general health. The younger and healthier you are when you start, the less the protection will cost.
Many policies charge an excess – the portion of any claim you must pay yourself. This can help keep costs down, but you may find that you pay for a great deal of treatment without ever passing the excess level and receiving any benefit from your policy.
So, you should also check exactly what benefits the policy you are interested in will pay for. Always read the small print to check if any particular illnesses and treatments are excluded.
It is possible to take these types of cover as standalone policies – but at Continuum, we often recommend that this type of cover is arranged as part of a complete financial protection plan. It means complete peace of mind – and it can help keep costs down.
For help with getting the health protection you need, and integrating it into an all-round protection plan, you need expert, individual advice.
If you would like to discuss health cover and protection, contact us today to get started.
Your home may be repossessed if you do not keep up repayments on your mortgage.
The information contained in this article is based on the opinion of Continuum and does not constitute financial advice or a recommendation to suitable Protection product, you should seek independent financial advice before embarking on any course of action.