Life Insurance vs Critical Illness [Which is Best?]

Q: What’s the different between life insurance and critical illness?

A life insurance policy pays out to your loved ones after your passing, whereas critical illness cover pays out to you if you’re diagnosed with a specific serious illness. These policies are similar in that they provide cover for a specified period and provide a tax-free lump sum. However, the difference is that one pays out upon the diagnosis of a serious illness ( critical illness cover ) and the other pays out upon your passing ( life insurance ). But, did you know, you don’t always have to choose between one or the other? Critical illness cover can be added to a life insurance policy for an additional cost to allow you to benefit from both forms of cover.

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Life insurance vs critical illness

What’s the different between life insurance and critical illness?
Do I need life or critical illness insurance?
Is critical illness better than life insurance?
Life insurance vs critical illness pros & cons
Is critical illness part of life insurance?
Life insurance vs critical illness cost
Do I need life and critical illness cover for my mortgage?
Can you get critical illness without life insurance?

What’s the difference between life insurance and critical illness?

A life insurance policy pays out to your loved ones after your passing, whereas critical illness cover pays out to you if you’re diagnosed with a specific serious illness.

What is life insurance?

A pay out is made to your loved ones if you pass away during the policy term
Provides cover for a set period
You’ll be covered for all manners of death^{^}
Pay out can help loved ones to cover costs such as your funeral, the mortgage and daily living expenses

What is critical illness cover?

A pay out is made to you if you’re diagnosed with a serious illness during the policy term
Provides cover for a set period
You’ll be covered for specified list of conditions
Pay out can help to replace lost income while you’re off work and/or pay for any private medical treatment

These policies are similar in that they provide cover for a specified period and provide a tax-free lump sum. However, the difference is that one pays out upon the diagnosis of a serious illness (critical illness cover) and the other pays out upon your passing (life insurance).

But, did you know, you don’t always have to choose between one or the other?

Critical illness cover can be added to a life insurance policy for an additional cost to allow you to benefit from both forms of cover.

Life insurance with critical illness cover is available through Reassured from just 33p-a-day^º.

Compare fee-free quotes through our award-winning and FCA-regulated broker service.

Compare Life Insurance with Critical Illness Cover »

Do I need life or critical illness insurance?

The option that’s best for you will ultimately depend on your personal circumstances and what you’re looking to cover.

Below is a table of key questions about each policy type to help you establish which might be suitable for your needs:

Key questions	Life insurance	Critical illness cover
What will you be covered for?	Provides cover if you were to pass away unexpectedly. All manners of death are covered	Provides cover if you were to fall seriously ill. A specified list of conditions will be covered, such as cancer, stroke and MS
What can the policy help to protect?	A life insurance pay out can help to cover funeral costs, the mortgage, additional childcare costs and other family living costs	A critical illness cover pay out can help to replace lost income while you’re unable to work and/or pay for private medical treatment
When will it pay out?	The policy will pay out if you pass away while your policy is active. This could be during a set term or your whole life (depending on what policy you opt for)	The policy will pay out if you’re diagnosed with a listed condition while your policy is active, this will be a set term.
Who is it available to	This can depend on the policy type you take out but typically life insurance is available to those aged 18 - 85	This can depend on the insurer, but typically critical illness cover can be available to those aged 18 - 69
Who receives the pay out?	Your loved ones (or named beneficiary) will receive the funds	The funds will be paid to you
How do you pay for cover?	You’ll need to pay a monthly premium	You’ll need to pay a monthly premium
How much does it cost?	Available from £5 per month through Reassured^†	Can be available from £5 per month through other insurers^[1]

Remember, you don’t have to choose between one or the other as it’s possible to secure life insurance with critical illness cover.

By securing this form of cover you can provide a comprehensive cover solution.

While we can’t help you compare just critical illness cover, at Reassured we can help you compare both life insurance and life insurance with critical illness cover.

Get in touch for your free and no-obligation quotes.

Is critical illness better than life insurance?

One isn’t necessarily better than the other as each policy provides cover for different circumstances.

Life insurance can be beneficial for:

Those with dependents
Those who worry about funeral costs being left to loved ones
Those with a mortgage
Those who want to provide an inheritance

Critical illness can be beneficial for:

Those with dependents
Those who worry about losing income due to being unable to work
Those with a mortgage
Those who worry about medical costs

Life insurance protects your loved ones should you pass away unexpectedly, helping to minimise any financial strain at an already distressing time.

Critical illness cover can protect you in the event of serious illness, reducing the financial impact of being unable to work and/or allowing you to pay for private medical treatment.

It’s common for both life insurance and critical illness cover to be combined to allow you and your loved ones to benefit from a comprehensive cover solution.

At Reassured we can help you compare life insurance with critical illness cover quotes from some of the UK’s best life insurance companies.

How much life insurance with critical illness cover do you need?

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Life insurance vs critical illness pros and cons

Life insurance PROs:

Provides loved ones with a financial safety net. Helping them to cover expenses such as your funeral, the mortgage and family living costs
There are a variety of policy types available (term-based cover, whole of life insurance, over 50 life insurance) to suit different needs
Premiums can be affordable, starting from just £5 per month (depending on policy type and personal circumstances)
It can be quick and easy to secure a policy. In fact, it’s now possible to buy life insurance online
Policies are often flexible, allowing you to change certain policy details (like your cover amount) to keep up with changing needs

Life insurance CONs:

A pay out might not be guaranteed. If you opt for term based cover your policy will last for a set period and will only pay out if you pass away during this time
You could pay more into the policy than it will pay out. If you opt for whole of life insurance or over 50 life insurance, you’ll need to pay premiums for the rest of your life
Premium costs are based on your personal circumstances, so if you have a pre-existing medical condition (or another high-risk factor, such as your occupation or hobbies) you may pay more for cover

Critical illness cover PROs:

Provides you with peace of mind that you can keep up with your financial commitments and/or provide for your family if serious illness prevents you from working
Cover can easily be added to a term life insurance policy (for an additional cost) to allow you and your loved ones to benefit from both forms of cover
Many common conditions are often covered including cancer, heart attack and stroke

Critical illness cover CONs:

You’ll only be covered for a specified list of conditions (typically this is 30 conditions, but this could be more or less depending on the insurer)
Your condition must also meet the insurers specified definition in order for a claim to be accepted
Not all insurers offer standalone cover. Meaning if you’re just looking to secure critical illness cover you may have fewer options available
If you have any pre-existing medical conditions, these (and any related conditions) will likely be excluded from your cover. This means you won’t be able to claim for these conditions

Speaking to a life insurance expert, such as Reassured, can allow you to obtain all the information you need to make an informed decision about which policy is right for you.

Why not get in touch to speak to one of our friendly and professional team members?

Why compare life insurance with critical illness cover through Reassured?

We’re the UK’s largest life insurance broker^* with over 14 years of experience
We’re rated as ‘Excellent’ on Trustpilot with over 80,000 customer reviews
A friendly member of our team can provide you with our best deals from some of the UK’s best life insurance providers
We can provide support throughout the entire application process (to help you decode any industry jargon)
We offer a FREE trust writing service with most of the policies we sell (avoid / minimise 40% inheritance tax for your loved ones)
Compare life insurance starting from £5 per month or life insurance with critical illness cover from £10 per month

Is critical illness part of life insurance?

Yes, critical illness cover can be part of a life insurance policy.

When you take out a term life insurance policy, you have the option to add critical illness cover for an additional cost in your monthly premium.

In this instance, your policy would allow you to claim if you become seriously ill (with one of the conditions specified in your policy) or your loved ones could claim upon your passing.

It’s important to be aware that once a critical illness claim has been made, cover will expire, and a claim can’t be made upon your passing.

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Can you get critical illness without life insurance?

Yes, some insurers offer standalone critical illness cover policies.

If you’d like your loved ones to benefit from two separate pay outs, you could take out a separate critical illness policy from your life insurance. However, this would require two separate premiums.

Not all insurers offer standalone critical illness cover.

Critical illness cover on its own isn’t available through Reassured, but we can help you compare life insurance with critical illness cover quotes from top UK insurers.

Life insurance vs critical illness cost

Life insurance premiums through Reassured can start from as little as £5 per month.

We don’t sell critical illness cover as a standalone policy. However, looking at other insurers, we have found that critical illness cover can also be purchased from £5 per month^[1].

Through Reassured, it’s possible to secure life insurance with critical illness cover from just £10 per month.

With both life insurance and critical illness cover, the exact price that you pay will vary based on your personal circumstances.

During the application process you’ll need to provide the following details in order for insurers to calculate your premium price:

Age
Health
Smoking status
Occupation
Lifestyle
BMI
Policy details

Below are some example quotes using our award-winning broker service.

Cost of life insurance

Quotes are based on a non-smoker, in good health, for a level term policy with a 20 year term with £100,000 of cover:

Age
20	£3.50	£5.24	£5.00
25	£3.67	£5.11	£5.12
30	£4.59	£5.55	£5.91
35	£6.16	£7.24	£6.92
40	£8.58	£10.12	£9.21
45	£12.22	£14.33	£13.55
50	£19.45	£22.30	£20.94

Cost of life insurance with critical illness cover

Quotes are based on a non-smoker, in good health, for a level term policy with a 20 year term and £50,000 of cover:

Age
20	£9.15	£9.17	£10.12	£11.84
25	£11.71	£11.69	£12.92	£14.21
30	£14.99	£15.04	£16.85	£17.79
35	£19.97	£19.94	£22.51	£22.95
40	£27.96	£27.93	£30.47	£32.62
45	£39.84	£39.81	£42.02	£47.41
50	£58.19	£58.16	N/A	£70.48

Why not use our award-winning and fee free service to compare quotes from top UK insurers?

Want more information on life insurance and critical illness cover average cost? Why not check out the following guides:

Do I need life and critical illness cover for my mortgage?

It’s not a legal requirement to have life insurance or critical illness cover when obtaining a mortgage.

However, it’s often advised by mortgage lenders and financial advisors. This is so there would be adequate funds to continue paying off the mortgage should the unexpected happen.

After your passing your loved ones may struggle to keep up with mortgage costs on a single income. However, a life insurance pay out could allow them to pay off this cost in full and remain in their home.

Similarly, if you were to fall ill and needed to take time off work, it could be hard to keep up with mortgage payments while you’re relying on sick pay. A critical illness cover pay out could allow you to keep up with your payments.

By taking out life insurance with critical illness cover, you could be covered for both circumstances (whichever happens first).

We have a ‘do I need life insurance for a mortgage?’ guide if you require more information on this topic »

Compare life with critical illness cover quotes

Using our award-winning broker service, you can compare both life insurance and life insurance with critical illness cover to find the right option for your needs.

We can also provide you with all the information you need to make a fully informed decision.

Life insurance starts from just 20p-a-day, with life and critical illness cover starting from 33p-a-day.

Why not take the first steps in financially protecting your loved ones and get in touch today?

All quotes are fee-free, personalised and completely without obligation.

Compare Life Insurance with Critical Illness Cover »