I already have life cover in place, but a friend recently mentioned specified illness cover. I’m in my 40s with a mortgage and two children, and thankfully I’m healthy.
Is specified illness cover really necessary, or is it just another add-on that insurance companies try to sell?
I want to be sure I’m not spending money unnecessarily, but at the same time, I don’t want to leave myself or my family vulnerable if something unexpected were to happen.
How do I know whether this is something worth considering alongside my life cover?
Answer: The short answer is – no, specified illness cover (sometimes called “critical illness cover”) is not just an extra add-on. It’s a form of protection designed to plug a very different gap than life cover and, for many people, it becomes particularly relevant in their 40s and 50s. That said, whether you need it will depend on your personal circumstances, finances, and risk tolerance.
In Ireland, serious illnesses such as heart disease and cancer remain unfortunately common.
For instance, chronic ischaemic heart disease was the single leading cause of death in 2022, accounting for nearly 8% of all deaths.
Lung cancer followed close behind, and when taken together, circulatory diseases and cancer account for around a third of all deaths. What makes this even more important is that survival rates are improving. While that’s wonderful news, it also means more people are living through major illnesses but facing substantial costs.
Life cover
Life cover is absolutely vital – it ensures your family are financially secure if you pass away. But its limitation is that it doesn’t help you if you survive a serious illness. If you were diagnosed tomorrow with a major condition, life cover would not provide for rehabilitation, lost income, or adjustments needed for your home or lifestyle.
Think about your current commitments: a mortgage, children’s expenses, daily household costs. Without a financial cushion, illness could cause significant strain at a time when your energy should be focused on getting better.
Special Illness Cover
If you’re diagnosed with one of the conditions listed in your policy, the cover pays out a tax-free lump sum. That money is entirely flexible and can be used for:
Covering treatment or rehabilitation costs. Reducing or clearing your mortgage. Replacing your lost income while recovering.Making adaptations to your home, if required.Simply giving your family financial breathing space.Some policies even include partial payouts for less severe conditions, such as early-stage cancers or minor strokes, so you can access some support without meeting the “full claim” threshold.
Like all forms of protection, Specified Illness cover has its caveats. Premiums can be significant, particularly if you are older or have health risk factors such as smoking or family history. Insurers also work with precise definitions – for example, a claim may need to meet their exact wording for what constitutes a “major heart attack”.
Finally, there’s the possibility you may never claim, which in itself is a positive outcome but may feel like “money spent without return.”
There are certain scenarios where it makes sense to consider it seriously:
You have dependents or a mortgage reliant on your income.Your savings or emergency fund are limited, meaning you’d struggle with a sudden loss of income. You are in your 40s or 50s, a stage when illness risk rises but you’re still working and responsible for significant outgoings. You want to have greater certainty and control over your finances if life throws you an unwelcome curveball. Perspective
Rather than viewing it as an optional extra, see Specified Illness cover as a complement to life cover – together they create a more rounded safety net. The real value lies in peace of mind, giving you space to focus on recovery instead of bills.
Ask yourself – if you were unable to work for six months or more, how would your family cope? Would your savings stretch to cover mortgage payments, school fees, and daily living? If the answer makes you uneasy, then this cover may well be worth considering.
Balance
Ultimately, it’s about balance; weighing the potential cost of premiums against the potential impact of a serious illness. If the premium is affordable and the gap in your financial safety net is clear, then it may give you and your family valuable peace of mind.
Martin Glennon, ifac.
Martin Glennon is head of financial
planning at ifac, the professional
services firm for farming, food and
agribusiness
What to ask yourself:
Would my savings cover 6-12 months of expenses if I couldn’t work? Would clearing part of my mortgage make illness recovery easier? Am I comfortable relying on just life cover, which only pays out if I die? Are the premiums affordable within my current budget? How much risk am I willing to keep on my own shoulders? If the answers reveal gaps or discomfort, then Specified Illness cover may be a wise step forward.
I already have life cover in place, but a friend recently mentioned specified illness cover. I’m in my 40s with a mortgage and two children, and thankfully I’m healthy.
Is specified illness cover really necessary, or is it just another add-on that insurance companies try to sell?
I want to be sure I’m not spending money unnecessarily, but at the same time, I don’t want to leave myself or my family vulnerable if something unexpected were to happen.
How do I know whether this is something worth considering alongside my life cover?
Answer: The short answer is – no, specified illness cover (sometimes called “critical illness cover”) is not just an extra add-on. It’s a form of protection designed to plug a very different gap than life cover and, for many people, it becomes particularly relevant in their 40s and 50s. That said, whether you need it will depend on your personal circumstances, finances, and risk tolerance.
In Ireland, serious illnesses such as heart disease and cancer remain unfortunately common.
For instance, chronic ischaemic heart disease was the single leading cause of death in 2022, accounting for nearly 8% of all deaths.
Lung cancer followed close behind, and when taken together, circulatory diseases and cancer account for around a third of all deaths. What makes this even more important is that survival rates are improving. While that’s wonderful news, it also means more people are living through major illnesses but facing substantial costs.
Life cover
Life cover is absolutely vital – it ensures your family are financially secure if you pass away. But its limitation is that it doesn’t help you if you survive a serious illness. If you were diagnosed tomorrow with a major condition, life cover would not provide for rehabilitation, lost income, or adjustments needed for your home or lifestyle.
Think about your current commitments: a mortgage, children’s expenses, daily household costs. Without a financial cushion, illness could cause significant strain at a time when your energy should be focused on getting better.
Special Illness Cover
If you’re diagnosed with one of the conditions listed in your policy, the cover pays out a tax-free lump sum. That money is entirely flexible and can be used for:
Covering treatment or rehabilitation costs. Reducing or clearing your mortgage. Replacing your lost income while recovering.Making adaptations to your home, if required.Simply giving your family financial breathing space.Some policies even include partial payouts for less severe conditions, such as early-stage cancers or minor strokes, so you can access some support without meeting the “full claim” threshold.
Like all forms of protection, Specified Illness cover has its caveats. Premiums can be significant, particularly if you are older or have health risk factors such as smoking or family history. Insurers also work with precise definitions – for example, a claim may need to meet their exact wording for what constitutes a “major heart attack”.
Finally, there’s the possibility you may never claim, which in itself is a positive outcome but may feel like “money spent without return.”
There are certain scenarios where it makes sense to consider it seriously:
You have dependents or a mortgage reliant on your income.Your savings or emergency fund are limited, meaning you’d struggle with a sudden loss of income. You are in your 40s or 50s, a stage when illness risk rises but you’re still working and responsible for significant outgoings. You want to have greater certainty and control over your finances if life throws you an unwelcome curveball. Perspective
Rather than viewing it as an optional extra, see Specified Illness cover as a complement to life cover – together they create a more rounded safety net. The real value lies in peace of mind, giving you space to focus on recovery instead of bills.
Ask yourself – if you were unable to work for six months or more, how would your family cope? Would your savings stretch to cover mortgage payments, school fees, and daily living? If the answer makes you uneasy, then this cover may well be worth considering.
Balance
Ultimately, it’s about balance; weighing the potential cost of premiums against the potential impact of a serious illness. If the premium is affordable and the gap in your financial safety net is clear, then it may give you and your family valuable peace of mind.
Martin Glennon, ifac.
Martin Glennon is head of financial
planning at ifac, the professional
services firm for farming, food and
agribusiness
What to ask yourself:
Would my savings cover 6-12 months of expenses if I couldn’t work? Would clearing part of my mortgage make illness recovery easier? Am I comfortable relying on just life cover, which only pays out if I die? Are the premiums affordable within my current budget? How much risk am I willing to keep on my own shoulders? If the answers reveal gaps or discomfort, then Specified Illness cover may be a wise step forward.
SHARING OPTIONS