What is Critical Illness Insurance?
What is critical illness insurance? A UK guide to CI cover: pays a tax-free lump sum if you're diagnosed with a serious illness like cancer, heart attack, or stroke. You receive the money while alive – you don't have to die to claim.
Critical illness insurance is a type of protection policy that pays out a one-off tax-free sum if you're diagnosed with a covered serious illness. Unlike life insurance which pays when you die, critical illness pays while you're still alive, giving you money when you need it most – to cover treatment costs, pay off your mortgage, or take time off work to recover.
Cover is subject to policy terms. Pre-existing conditions typically excluded.
Key Points
- 1Pays tax-free lump sum on diagnosis
- 2Covers cancer, heart attack, stroke, and 40+ conditions
- 3You receive money while alive
- 4Use the payout however you choose
- 5Can be combined with life insurance
- 692% of claims are paid successfully
Eligibility Criteria
- UK resident aged 18-70
- No existing diagnosis of covered conditions
- Health declaration required
- Pre-existing conditions may be excluded
Typical Timeframe
Policies can start immediately after application. Claims typically paid within 4-8 weeks of diagnosis confirmation.
Next Steps
- 1Calculate how much cover you need
- 2Compare providers and conditions covered
- 3Check policy definitions carefully
- 4Get expert advice on your options
Why This Matters for Your Mortgage
Understanding these details helps you make informed decisions during the mortgage process. Every element of your application—from deposits to documentation—affects your approval chances and the rates you can access.
Lenders assess applications holistically, weighing multiple factors together. Knowing what they look for allows you to present the strongest possible application. This is particularly important for non-standard situations where lender criteria varies significantly.
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Related Questions
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Content reviewed: January 2026
CeMAP awarded by The London Institute of Banking & Finance. Cert CII (MP) awarded by the Chartered Insurance Institute.