How much critical illness cover do you need?

Ways to decide your cover amount

Critical illness cover isn’t about leaving money behind. It’s about helping make sure you could manage financially if you were diagnosed with a serious illness in the future, and needed to take some time out to focus on your health.

But how can you work out the ballpark figure of how much cover you might need? Your cover amount will be one of the driving factors of how much you pay in premiums each month. So you’ll want to make sure you’ve considered what financial commitments you’d want to put the lump sum towards, while paying an affordable monthly premium.

With that said, here are a few pointers to help you decide. 

What is a critical illness?

A critical illness is a serious, sometimes life-changing illness, disease or disability that can impact every part of your life, including your ability to earn money to pay bills, and whatever else makes a regular appearance on your bank statements. 

Critical illness can happen to anyone, at any time. According to the Association of British Insurers (ABI), over £1.27 billion was paid out by insurers for critical illness claims in 2022.Footnote [1]

What does critical illness insurance cover?

When it comes to critical illness insurance, a critical illness is what’s defined in the policy. The three core conditions covered are specified severities of cancer, heart attack and stroke, but a policy can cover lots of other conditions, or just a few. 

So before you buy a policy, make sure you’re clear on the conditions it covers. Ours includes 52, which you’ll find listed here. Bear in mind you'll only be covered for these conditions if you survive for at least 10 days after diagnosis or surgery.

Unlike life insurance, this type of cover isn’t about leaving money behind when you’re gone. If you pass away, your critical illness policy ends and there’s no payout. 

What is a cover amount?

It's the amount you choose when you buy your policy that, on a valid claim, the insurer pays out as a tax-free lump sum. You can use this money however you like.

While the cover only pays the full lump sum out once, and the policy then ends, some policies, like ours, also include less severe conditions, and children’s cover at no extra cost. For this, the payout isn’t the full cover amount, but the policy will continue if you carry on paying your premiums.

How to work out how much critical illness cover you need

Ask yourself what costs you'd need the payout to go towards if you had treatment for a serious health condition and couldn't work. These might include:

  • A mortgage or rent 
  • Loans you’re paying off over time
  • Childcare or other costs for your dependants
  • Regular bills, like gas, electricity and water, council tax and car insurance 
  • Any medical expenses from adapting your home or travelling to hospital for treatment, or private medical care
  • General living costs, like food bills and petrol

Once you know what you’d need to cover, and you’ve added it all up, then consider if:

  • You have any savings or assets you could dip into or use
  • You’d be eligible for state benefits, like Employment and Support Allowance
  • You have an employee benefits package that covers a longer time off work due to sickness

You should then have a ballpark figure of how much you’d need as a payout, which you can use when you get a quote. If you’re not sure, you might want to speak to a financial adviser. 

You might be interested to know that, according to the same ABI data, the average amount paid by insurers for critical illness claims in 2022 was £66,296. This doesn’t mean that’s the cover amount you should choose, though – it has to be right for you and your family’s finances.  

How much can you expect to pay?

Outgoings and families vary, so it’s important to go for the policy, and cover amount, that’s going to suit your needs. The right cover amount and monthly premium for your neighbour won’t necessarily be right for you.

If you think critical illness cover isn’t for you, because you’ve heard it’s too expensive, you might like to know that over half of our customers pay just £18 a month or less for their cover Footnote [2].

Other than the cover amount you choose, here are some other things that affect how much you might pay:

Your policy

  • How long you want your policy to last, known as the policy term
  • The type of policy you have, including whether it’s standalone or combined with life insurance – ours is standalone
  • If your cover type is level or decreasing, or if the cover amount's protected from the effects of inflation
  • If it’s joint cover with a partner, or if it’s just for you

Your personal details

  • Your age, as the older you are when you take out the policy, the more you’re likely to pay
  • Your occupation, as riskier jobs are likely to mean premiums cost more
  • Your health and lifestyle, including whether you smoke, and your family medical history

It goes without saying that you need to continue to pay your premiums – if your payments stop, so does your cover.

How to choose between decreasing and level cover

Which type you choose depends on what you’d want the payout to help cover.

Decreasing cover

If you simply want to make sure you could pay off a repayment mortgage or long-term loan, you might want to go for decreasing cover. 

It’s called decreasing cover as the cover amount goes down over time, along with the amount you owe on your mortgage, or other long-term loan. That’s why it’s cheaper than level cover. You pay a monthly amount for a specific period of time, and your premiums are fixed.

Level cover

If you need the lump sum to cover other things, like rent or mortgage payments, childcare costs, regular bills, or any unexpected costs that result from having a critical illness, you might want to go for level cover. The amount of cover and the amount you pay each month stays the same until your policy ends. So your premiums will be higher than for decreasing cover, as the payout won't decrease over time.

You can choose to protect your cover amount from the effects of inflation, so it increases over time. This means your monthly payments may also rise, and at a higher rate, but the lump sum won't be worth less in the future because of the rise in the cost of living. 

Should life insurance and critical illness cover amounts be different?

If your plan is to have life insurance and critical illness cover, as they’re for two very different scenarios, you might like to know that our cover isn’t combined. So you get two separate policies, where you can choose different cover amounts for each, if you like. 

Remember that, unlike life insurance, critical illness cover won’t pay out if you pass away; it’s there to help you manage financially while you get treatment and are on the road to recovery. That may take just a few months, or may be longer term. Life insurance is about making provision for your loved ones when you’re gone. 

So you won’t necessarily need the same amount of critical illness cover as life insurance. You could test out a few different cover amounts when you get a quote, and see what premiums are affordable for you. Just make sure that whatever the cover amount is, it’s what you’d realistically need.

If you’re still not sure about how much cover to get, it’s a good idea to speak to a financial adviser. You can find one at

Considering critical illness cover?

Here’s everything you need to know about our cover – and how to get a quote.

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