Life Insurance

Terminal Illness Cover: An Extra Layer of Security

Feel secure even at the rare chance of illness.

  • By Paddy Compare
  • 11 June 2023

Most life insurance policies cover you financially for all causes of death, natural and accidental. However, it is important to carefully consider the various add-ons available with life insurance policies since some additional covers may be more suited to your specific needs.

Life insurance policies may include additional covers to enhance the coverage and provide extra benefits.

Other types of life insurance policies:

  1. Death in Service cover
  2. Joint Life Insurance
  3. Terminal Illness Cover
  4. Over 50s Life Insurance
  5. Critical Illness Cover

The Terminal Illness Cover or Accelerated Death Benefit allows you to receive a portion of the life insurance benefit in advance if you are diagnosed with a terminal illness. It helps you cover medical expenses or other financial obligations.

With Paddy Compare, you can carefully consider the various additional cover options available in Ireland, for you!

In this article

What is terminal illness cover?

Terminal illness cover is a type of insurance policy that provides a lump sum payment if you are diagnosed with a terminal illness. The terminal illness cover:

  • Provides financial support during final months
  • Takes care of medical expenses
  • Pays off debts
  • Provides financial security to the individual and their family
  • Is often included as an add-on within a life insurance policy
  • Can also be purchased as a standalone policy

Terminal illness cover vs critical illness cover

It's worth noting that terminal illness cover is different from critical illness cover. Understanding the difference between the two can help decision-making when choosing the right cover.

Terminal Illness Cover Serious Illness Cover
Applicable when the policyholder is diagnosed with a terminal illness and has a limited life expectancy. Provides a payout upon the diagnosis of a specific critical illness, regardless of the life expectancy of the individual.
Pays out a portion or the full amount of the death benefit before passing away. Provides financial support if you are diagnosed with a serious illness.
Provides resources for the family. Provides a lump sum to the family to cover daily expenses if you are unable to work.
Covers only terminal illnesses. Covers a range of curable illnesses and ailments.
Provides you with the resources required to manage your terminal illness before you pass away. Protects you financially in the short term, giving you time to get better.

Benefits of terminal illness cover

Depending on the type of policy you opt for, you can make a claim from your terminal illness cover if you:

  • Are undergoing surgery
  • Need treatments for broken bones
  • Get into an accident and are unable to work
  • Need to stay in hospital for treatment

In addition to the above-mentioned types of life insurance policies, there are a few other coverage options worth considering that can provide extra benefits and further enhance your insurance portfolio.

  1. Whole of life insurance
  2. Mortgage coverage
  3. Term life insurance

Advantages and disadvantages of getting terminal illness cover

Advantages Disadvantages
Provides financial protection for you and your family in the event of a serious illness.
The lump sum payment can help cover medical expenses, pay off debts, or provide financial support during a difficult time.
Can be relatively expensive compared to other insurance policies.
The premiums depend on factors such as your age, health condition, and the level of coverage you choose.
It can give you peace of mind knowing that you have a financial safety net if you were to be diagnosed with a terminal illness. It often comes with certain limitations and exclusions. Some terminal illness covers may not include specific illnesses or have waiting periods before you can make a claim.
It provides flexibility in how you use the lump sum payment. You can use it to seek the best medical treatment available, modify your home for accessibility, or any other purpose related to your diagnosis. It can have complex terms and conditions, which may make it challenging to fully understand the coverage and exclusions.
In Ireland, terminal illness coverage may have tax benefits. The lump sum payment is usually tax-free, which means you can use the entire amount for your needs without any deductions. Making a claim can sometimes be a complex process. The insurance company may require extensive documentation and medical evidence to validate the claim.

To make an informed decision regarding your life insurance policy, it is crucial to delve into the factors that affect its terms and coverage.

Along with this, check out tips to get cheaper life insurance in Ireland, which can help you find more affordable options without compromising on coverage.

Planning on buying life insurance?

Life insurance can be confusing. Is terminal illness cover the best option for you based on your specific situation? Get advice from our experts and compare your options.

Use Paddy Compare's services to get a clearer idea of what to opt for. We will do the hard work for you and put you in contact with the most suitable life insurance brokers.


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