Buying health insurance
Having cancer can influence the decisions you need to make when you are buying health insurance.
How health insurance works
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There are different types of health insurance, including:
Critical illness cover
This pays out a single lump sum if you’re diagnosed with a life-threatening health condition such as a heart attack, a stroke, some types of cancer or kidney failure. It also pays out if you become totally and permanently disabled.
Income protection insurance
This pays out a monthly income if you can’t work because of illness or disability. Most policies pay out until you either recover or reach retirement age. Some pay out for a maximum term – for example, five years.
Mortgage payment protection insurance (MPPI)
This pays your monthly mortgage payments (and sometimes a bit extra) if you’re unable to work. Depending on the policy, this type of insurance may cover you because of illness, an accident, unemployment or all three. It usually only pays out for a maximum of 1–2 years. You usually need to keep on paying the premiums for your cover while you are ill.
Payment protection insurance (PPI)
This pays out a sum of money to help cover your monthly repayments on loans, credit/store cards or catalogue shopping payments.
Private medical insurance
This pays back the cost of private treatment for ‘acute’ medical conditions that start after your policy begins. An acute condition is one that’s likely to respond quickly to treatment or one that you’re likely to fully recover from.
Waiver of premium benefit
This is an option you may have with a life insurance policy or a pension plan. The waiver pays your insurance premiums or pension contributions if you can’t work because of illness or disability. Depending on the policy, this may continue until you return to work, the end of the insurance policy term, a set age or a set date.
With all these types of insurance, the likelihood of making a claim tends to increase if you already have a pre-existing medical condition. This could make it harder or more expensive to get cover if you don’t already have it.
Buying health insurance
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Insurers can arrange your insurance in two different ways.
This is a method some insurers use to help you get cover in the future for a health condition you’re recovering from. MPPI, other loan protection insurance, short-term income protection and some private medical insurance typically use a moratorium.
The policy excludes any claims related to health conditions you have or have had recently at the time you take out the policy.
The exclusion lasts for the first year or two of the policy (the ‘moratorium period’).
If a claim is made after that time, the health condition is covered provided there are no further symptoms, medical advice or treatment during the moratorium period.
This is a process an insurer uses to assess the likelihood of you making a claim against insurance you take out.
Income protection insurance, critical illness cover and some private medical insurance usually use underwriting.
The insurer may ask for information about your health, your lifestyle and the health of close relatives. They may do this through questions and medical reports. Based on the assessment, the insurer decides whether to offer you cover, what premium to charge you and any other special terms or restrictions to include.
Health conditions that develop after you’ve taken out a policy don’t usually affect your premium or cover, providing you don’t change policy. But they may affect the terms you’re offered if you wanted to switch to a different policy.
Some employers arrange health insurance for their employees on a group basis. This may be private medical insurance or income protection insurance. Cover is often provided up to a set amount for employees who have joined the scheme, regardless of any health conditions they may already have.
Contact your personnel or human resources (HR) department at work to find out whether your employer offers any group health insurance schemes that you can join
How cancer can affect buying health insurance
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If you’ve had cancer or are living with cancer, you usually can’t get any health insurance cover for claims related to the cancer.
In some cases, you may be refused health insurance because of your cancer.
Insurers can also ask questions about the health of family members. This is because people whose close relatives (for example, parents, brothers and sisters) have had cancer may, in a small number of cases, be at a higher risk of getting the same cancer.
It’s possible to have genetic tests to check if you’re at a high risk of getting some types of cancer. There are two types of test:
diagnostic tests – these are carried out when you already have symptoms
predictive tests – these aim to assess the likelihood of you developing a condition.
You’ll usually have to tell the insurer about any diagnostic tests. Insurers can’t usually ask for or use the results of predictive tests.
If you have a family history of cancer but have had a favourable genetic test result, you may want to tell the insurer about it, and if you don’t have any other health issues, you could get cover on standard terms.
We have more information about cancer genetics.
Claiming on health insurance
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If you’ve been diagnosed with cancer or you’re off work because of it, you may be able to claim against any health insurance policies you already have.
Try to claim as soon as possible because there will usually be a time limit (for example, six months). After this, claims will no longer be eligible.
Before paying out on a claim, the insurer will make careful checks to make sure the claim is valid. This is likely to include getting medical reports from your GP and cancer specialist.
You may be asked to have a medical examination with another doctor. Paying out on a claim will usually take several weeks.
Income- and lump-sum insurance payouts may also affect your entitlement to state benefits. Check the policy documents for details of how to make a claim. If you used an insurance broker or financial adviser when you took out the policy, they should be able to help you claim.
Mortgage payment protection insurance claims
If you’re diagnosed with cancer and have a mortgage, you may have mortgage payment protection insurance (MPPI).
This should cover your mortgage payments if you’re signed off sick from work. You should make the claim as soon as possible, as the payout usually starts after a waiting period of around 30 days. With some policies, payments are backdated to the start of the period you’re off work. The payout should cover the whole mortgage payment and may provide a small amount of cash to help with bills as well.
MPPI provides useful temporary help but pays out for a maximum of 12 or 24 months. It’s important to keep up the mortgage payments after that time to avoid any risk of losing your home.
If you’re struggling with money problems, we have more information about managing your money day to day.
People who have a low income and get certain benefits may also be eligible for support with paying mortgage interest (see gov.uk/support-for-mortgage-interest).
Critical illness cover claims
Critical illness cover pays out a tax-free lump sum. It may have been taken out as a stand-alone policy or combined with life insurance.
If taken out in connection with a mortgage, critical illness cover may pay off the whole of the outstanding loan. If it’s not linked to a mortgage, the payout can be used for any purpose – for example, to pay bills during a period off work, cover private treatment costs in the UK or abroad, or pay for a holiday.
A cancer diagnosis doesn’t necessarily trigger a payout. Check the wording of a critical illness policy to see which cancers are covered. If the wording is unclear, contact the insurer.
Income protection insurance claims
Income protection insurance pays out a monthly income if you’re unable to work because of illness or disability. You will have chosen the level of income at the time you started the insurance and hopefully it will be enough for you to pay your bills and carry on with a reasonable lifestyle. You’ll also have chosen a waiting period before the payments start, which may be from four weeks to up to two years.
The insurance usually carries on paying out until you either return to work or reach retirement age, whichever comes first. But some policies pay out only for a maximum term. This could be five years, for example, or less for short-term income protection policies.
You should let the insurer know if you change your occupation or move home after buying income protection insurance. If you don’t, there’s a chance your claim will be refused.
Payment protection insurance claims
Payment protection insurance claims If you’re diagnosed with cancer and have a personal loan or credit card, you may have payment protection insurance (PPI).
This should cover your loan or card repayments if you’re signed off sick from work. You should make the claim as soon as possible. Usually, the payout only starts after a waiting period of around 30–60 days. With some policies, payments are backdated to the start of the period off work. PPI pays out for a maximum of 12 or 24 months.
PPI has been widely mis-sold in the past. If your claim is turned down and you feel that it wasn’t made clear to you when you took out the insurance that claims like yours wouldn’t be covered, you should consider making a complaint, as you may be eligible for compensation. For more information about making a complaint, contact our financial guides on 0808 808 00 00.
Private medical insurance claims
If you have private medical insurance (PMI) – either your own policy or cover through work – it may reimburse the cost of some or all private treatment for cancer. PMI is designed to cover acute medical conditions but not chronic ones. There can be confusion about when cancer counts as acute or chronic.
Macmillan Cancer Support worked with the Association of British Insurers (ABI) to make sure PMI insurers have a separate section that explains the cover for cancer using agreed examples.
You’ll need to check the wording of the policy and it may be helpful to discuss it with the insurer. You must get the insurer’s approval for any course of treatment before it goes ahead, otherwise the insurer may refuse to pay.
There may be arrangements for the insurer to pay the bills directly. Alternatively, you’ll need to pay first, then collect receipts and claim refunds. For income protection insurance or private medical insurance provided through work, contact your personnel or human resources (HR) department for guidance on making a claim.