Do I Need Income Protection Or Serious Illness Cover If I Already Have Health Insurance?

There are so many different variations of insurance out there, so it can get confusing trying to figure out which exactly you need. Many people assume that they are sorted in terms of cover should they become ill once they have health insurance. However health insurance has its limitations, which often isn’t apparent until you’re faced with illness.

Health insurance mainly covers medical expenses related to an illness and injury.  Income protection however replaces lost income when you are unable to work due to illness or injury, and serious illness pays a lump sum upon diagnosis of a specified serious illness. So having one doesn't necessarily mean that you don’t need any of the others. 

·        Health Insurance:

Primarily covers medical costs like doctor visits, hospital stays, and surgery. Depending on your level of cover there may be an excess to pay. Health Insurance doesn't replace lost income if you're unable to work. 

·        Income Protection:

Replaces a portion of your income (up to 75%) if you can't work due to illness or injury by providing you with regular payments. This helps with day to day expenses like your mortgage/rent payment, your bills, and living costs. 

·        Serious Illness Cover:

Pays a tax free lump sum upon diagnosis of a specific serious illness (e.g. cancer, heart attack, stroke). This money can be used for whatever you like, including medical bills, mortgage payments, or even house adaptations.

Why might you need Income Protection or Serious Illness Cover even when you already have Health Insurance? 

·        Lost income:

If you are unable to work due to a serious illness or injury, your company may continue to pay you for a few months, however once that stops, you will be relying on savings. Health insurance won't cover your lost income. 

·        Financial strain:

Even with health insurance, having a serious illness can result in severe financial strain due to medical expenses and potential lifestyle changes. 

·        Dependents:

If you have dependents who rely on your income, health insurance will not provide for this. Serious illness or Income Protection can provide a safety net.

·        Specific illnesses:

Your health insurance may not cover all illnesses or conditions that a serious illness policy would

·        Long-term care:

Income protection will provide financial support for an extended period (until you return to work), whereas health insurance is typically focused on acute care. 

So in conclusion, while health insurance is valuable for covering medical expenses (we wouldn’t be without it) it doesn't address the financial implications of not being able to work due to illness or injury. Income protection and serious illness cover offer different but important financial benefits that work well in tandem with health insurance. For us Income Protection (provided you are eligible) is the gold standard as it continues to pay out until you return to work or retire, so a combination of health insurance and income protection would be our recommendation in most cases.

If you have any questions, get in touch and we will be straight back to you

www.citywidefinancial.ie

01 5138710                                                

info@citywidefinancial.ie