Life insurance policies come with a whole raft of additional benefits. These can be in the form of additional services like virtual GP access or access to Mental Health Services and some benefits such as Terminal Illness Benefit. Terminal Illness Benefit is usually included with your life insurance and has been around since the 1980's but it has changed a little in recent years so it's worth looking at what it is, how it could benefit you and what you should check for within your own Life Insurance Policy.
What is Terminal Illness Benefit?
It's a benefit within your life insurance that allows you to claim your death benefit early if you become terminally ill. There are certain caveats to this. The insurer will usually require a medical professional to confirm that your illness is likely to lead to death within the next 12 months. Now, this in itself can be a difficult thing to confirm due to advancements in medical treatments. Doctors don't usually rush to put a time limit on someone's life because this can be misleading and upsetting for the person and their families. However, it does happen and terminal illness claims are paid out from time to time.
The other caveat that exists with some policies is that you can't claim terminal illness benefit in the last 12 months of your policy. If you're diagnosed with a terminal illness in the last 12 months of your policy then your death might happen after the policy ends and for this reason some policies include a clause that doesn't allow a terminal illness claim during this period.
In recent years, insurance companies have changed their stance. So, if you've taken out your life insurance over the last few years then your policy may not include the clause that disallows a terminal illness benefit in the last 12 months of the policy. Different insurance companies made this change at different times so you would need to check the terms and conditions of your policy to check if the clause exists.
What to do if you think your Terminal Illness Benefit doesn't cover you for the last 12 months of the policy
Firstly, don't cancel your policy. Policies are priced based on your age, health and smoker status when you apply for them and the last thing that you'll want is to cancel a policy, only to find that you can't arrange another or it's a lot more expensive to do so. If you've checked your terms and conditions and you feel that you want to change your policy to ensure that the Terminal Illness Benefit runs right up until the end of your policy then we would recommend that you do the following:
- Ensure you have all your policy details to hand
- Speak to a specialist adviser
- Ensure that you explain what you expect from your policy
- The adviser will advise you on the cost and whether any changes in your circumstances will affect a new policy
At Money to the Masses, we've vetted the services of LifeSearch. LifeSearch* is an independent advisory company that deals with the whole of the life insurance market and will be able to provide unbiased guidance on the right way forward for you. You can fill in this form* to arrange a callback from a LifeSearch adviser. If you do decide to take out a policy, although there is no obligation for you to do so as the advice is free, then you are entitled to £50 cashback.