What Is The Difference Between Critical Illness Cover and Income Protection?

When it comes to getting the right insurance, it’s important to know which type of cover you need. But with so many different policies out there, and some seeming rather similar, it can be difficult to distinguish one type of cover from another. At Agentis, we’re often asked about the difference between critical illness cover and income protection, which is what we’re covering in this article.

Critical illness cover is a very specific type of insurance that can often be viewed as a form of income protection. However, this cover is exclusively designed to relieve the financial burden upon the diagnosis of an illness. It pays a lump-sum, which can be used to cover your expenses as you see fit. You will receive a pre-agreed amount, and you will only receive a single payout. In other words, it’s not a lifelong policy.

On the other hand, income protection is designed for the long haul, with policies ranging from 12 months to retirement age. If your income should pause due to sickness, injury, or a disability, you can make a claim on the insurance. It provides you with a regular income until you return to paid work or you retire. The amount of income you can claim will not be the exact amount you were earning before and is often up to as much as 60% of your gross income, this will help protect your finances and your family if you have one.

Just like critical illness cover, income protection is designed to cover pauses in income due to illnesses or injuries. It does not cover redundancy.

Critical illness cover or income protection – which is right for me?

Critical illness and Income protection are often viewed as similar to one another which is why it is so important to compare these two types of insurance carefully to make sure you’re taking out the right cover. The team of expert insurance brokers at Agentis are here to help you find the ideal insurance policy. Contact us today to book your free initial consultation.