Critical illness cover with life insurance

Critical illness cover with life insurance provides a cash lump sum if you are diagnosed with one of a range of specified critical illnesses, a terminal illness or if you die. Our critical illness cover with life insurance product is called Critical Illness with Life Cover and is one of the benefits available under our Protection for Life plan.

What is Critical Illness with Life Cover?

Critical Illness with Life Cover can provide a cash sum to help you and your family financially if you were to die, or be diagnosed with a terminal illness or specified critical illness within the policy term. The benefit amount can be level, increasing or decreasing.

The policy will end if we pay out the benefit amount. If this amount has not been paid out by the end of the term, the policy will end and you’ll get nothing back. The policy has no cash-in value. The premiums you pay for this benefit are reviewable every five years and can change. See the Key Features of Critical Illness with Life Cover for more information.

Why might I ever need Critical Illness Cover?

Every two minutes in the UK, someone:

Is diagnosed with cancer*
Suffers a heart attack**

The good news is that medical advances mean that many serious illnesses may not prove fatal. However, they can still have a major impact on your life and on your ability to earn a living. Our research has shown that only 29% of parents have a policy that would pay out if they were to suffer from a critical illness.***

Critical Illness Cover can reduce the financial impact of a critical illness by helping with practicalities such as helping to pay off your mortgage and helping to pay any bills, allowing you the time to recover.

Dr Marius Barnard pioneered the idea of critical illness cover. At the 40th anniversary of the first heart transplant, he talked about his work as a pioneering heart surgeon and how he developed critical illness cover.
(*source: Cancer Research UK, July 2008)
(**source: BBC Online, August 2008)
(***source: Scottish Widows Research, May 2006)

How does Critical Illness with Life Cover work?

Each month, you pay an amount for the period you’ve chosen to be covered for.
The cash sum that you’re covered for is known as the benefit amount
Your monthly payment is known as a premium
The period you’re covered for is known as the term.

The policy will end if we pay out the benefit amount. If this amount has not been paid out by the end of the term, the policy will end and you’ll get nothing back. The policy has no cash-in value. Also, if you don’t pay your premiums in time your cover will stop, your benefit will end, and you’ll get nothing back. Full details on how Critical Illness Cover with Life Cover works are given in the Policy Provisions. A hard copy is also available on request.

What illnesses are covered by Critical Illness Cover?

We cover the illnesses recommended by the Association of British Insurers (ABI) Statement of Best Practice for Critical Illness Cover, which are:

Alzheimer’s disease - resulting in permanent symptoms
Aorta graft surgery - for disease
Benign brain tumour - resulting in permanent symptoms
Blindness - permanent and irreversible
Cancer - excluding less advanced cases
Coma - resulting in permanent symptoms
Coronary artery by-pass grafts - with surgery to divide the breastbone
Deafness - permanent and irreversible
Heart attack - of specified severity
Heart valve replacement or repair - with surgery to divide the breastbone
HIV Infection - caught in the UK from a blood transfusion, a physical assault or at work in an eligible occupation*
Kidney failure - requiring dialysis
Loss of hands or feet - permanent physical severance
Loss of speech - permanent and irreversible
Major organ transplant
Motor neurone disease - resulting in permanent symptoms
Multiple sclerosis - with persisting symptoms
Paralysis of limbs - total and irreversible
Parkinson’s disease - resulting in permanent symptoms
Stroke - resulting in permanent symptoms
Third degree burns - covering 20% of the body’s surface area
Traumatic head injury - resulting in permanent symptoms

* The eligible occupations for HIV caught at work are:

The emergency services - police, fire, ambulance
The medical profession - including administrators, cleaners, dentists, doctors, nurses and porters
The armed forces

We also cover some additional critical illnesses, which are:

Bacterial meningitis - resulting in permanent symptoms
Bone marrow failure - permanent and irreversible
Creutzfeldt-Jakob disease (CJD)
Progressive supranuclear palsy
Total permanent disability

The heading of each critical illness is only a guide to what’s covered. For example, some types of cancer are not covered. Further details on how your critical illness claim will be considered, including the full definitions we’ll use and the evidence we’ll need, are given in provision 5 of the Policy Provisions. A hard copy is also available on request.

The illnesses listed here are an indication of those offered to customers applying directly to Scottish Widows and who are accepted on standard terms. Special terms may be applied to individual cases.

Can I take Critical Illness with Life Cover out with my partner?

You can choose to apply for benefits to cover your own life – this is a single person plan.

Or, you can apply for benefits with your partner to cover your individual protection needs in one plan with joint ownership – this is a two person plan.

And with the built-in flexibility, you can change your plan if your circumstances change in the future. Similarly, if you have a two person plan and you separate or divorce, you can even split the plan. If you take out a two person plan we’ll also ask you to give your consent to share all information relating to your plan, including details of each other’s policies.

Can I change the level of cover?

Yes. Once your policy is set up you have the flexibility to adapt or increase the amount of cover at any time, increase or reduce your term, or add on benefits when it suits you. Some changes will lead to us carrying out further underwriting.

Can I choose who gets the payout if I die?

Yes, you can nominate who you’d like as a beneficiary. You may also wish to write your policy under an appropriate trust for the benefit of anyone you specify. We’ll automatically issue you a trust form with your policy documents in case you wish to do this.

Find out more about putting your policy in trust.

How much cover might I need?

It depends on your personal circumstances. Some things you may want to consider are:

how much your family would need to support themselves without your salary
if you have children going to university and when they would graduate
the size of your mortgage and how long it’s got to run
any other outstanding loans or debts you have
the amount you want to pay each month.

Children’s Critical Illness Cover

If you choose Critical Illness with Life Cover, children’s Critical Illness Cover is automatically included.

This can pay out a cash lump sum if your child is aged between six months and 21 years and is diagnosed as suffering from one of a range of specified critical illnesses (this excludes Total Permanent Disability) within the policy term, and is still alive after 14 days. Please read the Critical Illness with Life Cover Key Features for further information.
Payment is limited to the lower of £25,000 or 50% of the amount payable under the policy. A maximum of £25,000 for each child diagnosed as suffering from a critical illness will be paid regardless of the number of critical illness policies purchased and in force with the Scottish Widows or Lloyds TSB Bank.
Any children’s claims you make will not affect your own level of cover.

Lifetime cover