Norwich Union average Critical Illness claim over £75,000

Norwich Union have released their Critical Illness statistics for 2008, showing that they paid over 90% of claims, with the average claim amounting to over £75,000.

Norwich Union increased the amount they paid out for Critical Illness claims to £121 million, from £106 million in 2007.

At 63%, cancer was the main cause of claims.

It is important to realise that Critical Illness cover is not the same as the terminal illness benefit that may be included under a life insurance policy.

There are different types of Life cover available depending on your needs:

• Guaranteed Whole of Life Insurance – life insurance cover that lasts for the rest of your life, your family receive a guaranteed cash sum whenever you die
• Level Life insurance – provides financial security for your loved ones or to cover an interest-only mortgage
• Decreasing Life insurance – provides cover for a repayment mortgage or a loan that decreases over time
• Critical Illness cover – pays out a lump sum if you are diagnosed with a critical illness that is defined and covered by the plan and you survive for at least 14 days.

Generally life insurance plans do not have a cash-in value at any time. That said there are instances where under a Guaranteed Whole of Life plan there is a limited cash-in value.

With a Norwich Union life insurance policy, terminal illness benefit is included. With this, as long as your policy has more than 18 months left to run, you will be paid the sum insured if you are diagnosed with a terminal illness and as a result of which you are not expected to live more than 12 months.

You can take out critical illness cover as a standalone plan or you can take out life insurance with critical illness cover.

You can easily get a life insurance quote, it takes under 2 minutes and is easy to arrange.

As with all insurance though, you need to be careful to get the cover you need. The information you provide must be clear and accurate otherwise you risk any future claim not being paid.

For Critical Illness, NU advised that in 2008 some 8% of claims were declined as the condition claimed for was not covered by the policy.

Also 2% of claims were declined for non-disclosure of medical facts at the start of the policy.