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Jersey Consumer Council

Consumer News

Critical Illness Insurance

October 27, 2015 Insurances No Comments

Critical illness insurance- How critical is it?

Research conducted by Omega Financial Services who advise on Critical Illness policies have established that a quarter of Critical Illness claims in the UK occur before the age of 40!

Back in 1986 Abbey Life launched the first Critical Illness policy with just 5 conditions covered, now there can be as many as 64 critical conditions covered.

People need to consider taking out appropriate cover earlier in life when premiums are cheaper. The excuse of ‘it won’t happen to me because I am young’ could not be more wrong.

According to data from the Reinsurance Group of America in the UK, which looked at the percentage of life and critical illness claims in the UK by age group, 8% of people aged 25-40 had a life assurance claim. The figure rose to 24% for critical illness claims. 67% of people aged between 40-60 claimed on life assurance and seven in ten (70%) claimed on Critical Illness, whilst just 5% of those over 60 claimed on critical illness, a third claimed on life cover.

Based on this data, around one in every 12 claims for life cover in the UK occurs before the age of 40. For Critical Illness the number rises to I in 4, which evidences that putting off buying cover until we are older can be counterproductive (and significantly more expensive).

Aviva has purchased their overall critical illness claims statistics for 2013 and the claims paid out were as follows:

Cancer Heart Attack Stroke Multiple Sclerosis Total Permanent Disability Other
67% 11% 6% 5% 4% 7%


Aviva has also announced that the average claim age in 2013 was 45 for a woman and 48 years for a man.

Bright Grey announced that for 2012, people under the age of 40 made 37%o of successful critical illness claims.

Common misconceptions about Critical Illness cover are:

  • All policies are similar, so choose the cheapest
  • They don’t pay out
  • It is too expensive for me

All policies are certainly policy not the same, some will
have improved definitions,
and extra illnesses covered,
will mean a successful
claim is more likely. Some providers will give added extras such as ‘Best Doctors’. This means that if any of your family members have an illness, ‘Best Doctors’ will find a specialist Doctor anywhere in the world who will give a second opinion of the diagnoses and treatment. This has saved many lives.

The vast majority of claims are paid out. Those that do not meet the policy definitions or there has been non-disclosure on the proposal form. Aviva for example paid out 92.9% of all claims received during 2013. l.2% of claims were declined because of non- disclosure and 5.9% because the claim did not meet the policy definitions.

Critical illness cover is affordable. The secret is to take it out when you are young.


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