Summary
The system in which the seriousness of an illness can alter the pay out. How insurers are creating new policies which give limited pay outs.

Being informed that you are suffering from  cancer is distressing news. At some time duringour lives, one in 4 of us will get the disease. It is not  that PPP noticed that of all illnesses, cancer gives people in Briton the greatest apprehension.

At this difficult time you would be expecting an instant settlement by your health insurers, permitting you to focus on getting better. Unfortunately you could be given a big surprise. Many cancer sufferers make a full recovery thanks to progression in medical science. Currently some cases are not even seen as critical, so it is distressing to learn that lots of health and life insurance policies only settle when your illness is terminal or life threatening.

An independent financial adviser, counsels that people should not take for granted that they will receive a pay out just because they have been diagnosed with a severe condition. He advises people not to focus on the cost alone when taking out an life cover, for protection for their home but to study the terms and conditions in a private health or critical illness policy to be sure that the insurers will settle when you need it most.

On the diagnosis of an explicit illness, critical illness cover will settle a lump sum. Whereas, you will get superior quality and speed of treatment with private health/medical insurance. For example, appropriate licensed treatments could be accessible, which are not given out on the NHS. A spokesperson of independent advice firm Direct Life and Pensions says about 15 % of claims fall short on protection policies and at pay out for severe illnesses and diseases. However some cancers sound much more severe than they are and in these cases you probably won’t get any money from traditional policies.

Formerly life assurance companies had an all or nothing attitude, but they are now beginning to offer plans with a partial or full payout. An example is PruProtect, an alternative critical illness policy from the Prudential, which links the size of the settlement to the gravity of the condition and how much hardship it will cause. This policy does not become null and void once a demand is made but following pay outs may be lowered significantly. This figure is very crucial when the patient is diagnosed with a stage 1 or stage 2 cancer, which may become even more severe.

Just lately the insurance industry addressed the tricky issue of customer non-disclosure. The ABI has brokered a new agreement, which will permit claims effected by non-disclosure to receive a full or partial settlement, which was not the case previously.

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