A guide to adding your children to your life insurance policy

Every parent takes out life insurance for the same reason - to protect their little ones.

But what happens if the ones you want to protect were to fall ill themselves? Well, that’s where children’s critical illness comes into play.

A reality for some

No parent wants to think about their babies becoming ill, at the end of the day, it’s the worst case scenario, right? But every parent's nightmare is a reality for some.

Just last year alone, Legal and General paid out a total of £2,734,193 in children’s critical illness claims - an astonishing amount. This is bittersweet as there can’t be a claim without a child being critically ill, however, it also means that so many families received money, at a time when they needed it most.

What is critical illness cover?

To understand the children’s version of this cover, it makes sense to learn the basics of critical illness insurance in general.

Firstly, when we help you arrange your cover, we will advise you on what your sum assured should be (the amount you’re covered for) and we will make sure you understand how this policy can help you. Once your policy is all set up, you’ll be covered for a long list of critical illnesses which will be detailed within your policy conditions.

So the way critical illness cover works is simple, if you were to be diagnosed with one of a long list of conditions set out by your provider, then you can make a claim on your cover. If your claim is valid, then you will receive a cash lump-sum and your policy will end. Last year Legal and General paid out a staggering £209,446,943 in critical illness claims.

Children’s critical illness cover 101

The main thing you need to know about children’s critical illness cover is that it is not a standalone policy. This means that you can’t just get this cover, as it is an add on to an adults critical illness policy. But the good news is that a lot of life insurance providers automatically include children’s cover within your policy and at no extra cost too!

Another amazing fact about children’s critical illness cover is typically once a claim has been made, it does not have any effect on the main policy. So theoretically, if worse came to worst, you and your child/children could be able to claim on your critical illness cover.

What can the pay-out from this policy be used for?

Okay enough about what this cover is and let’s talk about what the pay-out from this cover can actually do. When you take out a critical illness policy, you probably never imagine having to use it but here’s just a few things you could use the pay-out for:

• Travel costs, if the care you need is further away
• Modifications to your home, if needed
• A holiday of a lifetime, to make those all important memories
  
  

There’s plenty more you could use the pay-out for, after all, the money will be yours to do what you want with. However, there are certain things that this cover can give you that you can’t touch or see - peace of mind and one less thing to worry about at a difficult time.

How much will the pay-out be?

As children’s critical illness cover is an extension of your own cover, the way the pay-out works is a little different to an adult policy.

Every provider is different when it comes to children’s critical illness cover and you’d be here all day if we listed them all, so here’s a few. Scottish Widows, for example, will pay-out £30,000 or 50% of the main sum assured (whichever is lower). Legal and General are similar and offer up to £25,000 or 50% of your amount of cover, whichever is lowest.

What conditions does this policy cover?

The conditions that this policy covers will vary depending on the provider. But some of the main conditions covered by children’s critical illness cover are:

• Cancer
• Down’s syndrome
• Cystic fibrosis
• Stroke
• Diabetes
• Cerebral palsy

If your child were to sadly be diagnosed with one of these conditions or any other details in your policy conditions, you could make a claim on the children’s critical illness element of your policy.

How to claim on this cover

If your child were to be diagnosed with a critical illness as defined in your policy conditions then you will be able to make a claim on your policy.

To make a claim on the children’s element of your critical illness policy, it works the same as if you were going to make a claim on your own cover. You simply need to get in touch with either us (or your insurer, whichever you prefer) and we will get the ball rolling in regards to your claim. Once it has been accepted, you will receive the pay-out and the money is yours to do with what you want!

The sad truth

When arranging a life insurance policy, you hope you never have to use it, never mind your children having to use it. But the sad truth is, just last year, 144 children’s critical illness claims were made with Legal and General alone.

This means that 144 families received a pay-out last year from just one insurer and there are a lot of other insures too! So the reality is that sadly this type of cover is needed and is used by families all over the country.

We are here for you

When we help you arrange your policy, we don’t just part ways, we are with you every step of the way.

At Caspian, we pride ourselves on our after care and have a dedicated in-house trust team, customer service team and if the worst happens, we have our very own claims service at your disposal. To make the first step in sorting your life insurance, click the button below to start your free quote with Caspian today.