Accelerated vs. standalone serious illness cover

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Dublingirl10

Registered User
Messages
15
Hi everyone,

I’m in the process of buying a life insurance policy and was given two options:
  • Option 1: €100K life cover + €25K accelerated serious illness cover
  • Option 2: €75K life cover + €25K standalone serious illness cover
Option 1 costs only a few euros less than Option 2. I understand that if I claim the €25K for illness and later die, the total payout would be the same in both cases. Broker’s advice is for the accelerated one as it’s a few euros cheaper and pays immediately if diagnosed with a serious illness. I wonder why the standalone option is more expensive though.

Would appreciate any insights from people who have experience with these options.
 
Depends on your objective ie. Why are you gerting cover on the first place?

Both option seems slightly odd to me
 
Hi @Cameo, the main purpose is to leave some income for my estate in case I pass away while they are still dependent. I already have separate mortgage protection.
 
Hi @ClubMan , I’m currently reading through the T&Cs, and the level of detail is impressive. My main concern is that with the accelerated option, if I were to claim for a serious illness, the claimed amount would reduce the life cover, whereas with the stand-alone option, the life cover remains intact. I’m especially curious about any long-term implications with the accelerated option, which is cheaper—for example, if I were to make a claim and then look to renew the policy at the end of its term.
 
Scenario A: serious illness (e.g. stroke), not followed by death
Option 1 payout = 25 + 0 = 25k
Option 2 payout = 25 + 0 = 25k
--> No difference

Scenario B: serious illness (e.g. cancer), followed later by death
Option 1 payout = 25 + (100 - 25) = 100k
Option 2 payout = 25 + 75 = 100k
--> No difference

Scenario C: death without a prior illness (e.g. car accident)
Option 1 payout = 0 + 100 = 100k
Option 2 payout = 0 + 75 = 75k
--> 1 pays more

Option 1 is better since it has more life cover. If Option 2 is more expensive why is your broker offering it at all?
 
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Thanks, @Corola . That’s a good point. I received both quotes when I asked about the difference between the accelerated and stand-alone options. The fact that the stand-alone option is a bit more expensive makes me question whether it provides better overall benefits. The broker is clearly in favour of the accelerated option.

Statistically, scenario B seems more likely so that’s influencing my decision. (According to financiallife.ie, “an individual who is aged 30 is more likely to get a serious illness than die over the following 20 years.”)
 
Dublingirl10 said:
Statistically, scenario B seems more likely so that’s influencing my decision. (According to financiallife.ie, “an individual who is aged 30 is more likely to get a serious illness than die over the following 20 years.”)
Click to expand...
Both still unlikely events to happen

Important point is serious critical illnesses only cover specific serious illnesses

Conversion options are normally only available up to a certain age (cover can only be extended to a particular age). The option doesn’t always apply to a whole of life policy

Do you have a death in service benefit from any employment e.g. 3 times salty or something?
 
Thanks, everyone. I’m wondering if I really need serious illness cover, since I have access to extended paid sick leave and a death-in-service benefit as a public servant on the Single Public Service Pension Scheme. I was just looking for affordable life cover but, as one does, ended up considering serious illness cover as well. I’m in good health otherwise, probably being more cautious than necessary. Any advice to help me get back on track? ☺️
 
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