Very little is more worrying in life than to be diagnosed with a serious or severe illness. Concerns are made a thousand times worse when your insurer tells you that they will not pay out on your critical illness insurance or private health insurance for the Cancer or HIV you are afflicited with.

You are told to peruse sub-clause five of paragraph 328 of the small print, which states that you have been diagnosed with the  wrong sort of cancer. Only tumours below the knee are covered and only the first five days of your treatment will be paid for, and then it is up to you to find the finance.

This situation may sound absurd, although brokers and insurance companies are regulated, this type of procedure continues to carry on. It has been a slow process to freshen up the industry and to ensure consumers get a decent deal.

A short time ago Cancer Backup, a registered charity, emphasizes this problem by organising a large assortment of  shopping surveys, which brought to light some disconcerting facts about the private health insurance industry. It found that of most of the leading insurance companies only PPP gave cover for cancer patients right through the length of their illness. Only the first part of the treatment is covered by the majority of health insurance companies. Treatment or care over a longperiod, such as hormone replacement or chemotherapy is not normally included.

Although brokers and insurers want to finance long term cover for insurance holders with life treatening illnesses, they won’t always make it clear to would be clients, at the time of taking out the policy what they are covered for. It’s a matter of cheap life insurance.

Eeven though both Macmillan Cancer Support and Cancer Backup have been in talks with comparable establishments within the market to lift the standard of sales practices and make the wording of policy documents much clearer, since the report was published two years ago, progress has been slow.

Critical illness cover and private medical insurance  is normally taken out by clients who are relatively robust and healthy. The last thing that crosses their minds is getting cancer. That is why it is so vital to spell out a life insurance policy’s exclusions before they sign up.

A statement of best practice for insurance companies writing and selling medical insurance policies has been modified recently by the Association of British Insurers, which is a much needed step in the right direction.

The trade body has now proposed that insurance companies and providers selling these forms of insurance should prepare typical case studies, which clarifies the conditions when an insurance policy will or will not be paid. Sadly insurers no requirement to adhere to this code, which is voluntary.

Even though the ABI’s initiative is to be appreciated, the best way of explaining an insurance policy is by asking the salesperson to explain the small print.

Furthermore, industry terminology is in spite of everything even now being utilized by insurers to confuse the client. For instance it is wrong to categorize cancer as an acute or chronic illness, argues Cancer Backup. Nevertheless insurance companies are resolute that it should go in the acute group. clients are only told about this when their claim has been rejected.

Even though the  Association of British Insurers have their heart in the right place, the insurance companies can only be made to upgrade their standards by the regulator. Better training of tele sales staff, who sell the majority of the policies, is also long overdue.

More rigorous marketing procedures are crucial with terminology being eliminated. At the end of the day it remains the responsibility of the insurance companies to ensure that their customers are fully aware of the terms of their insurance before they commit themselves.

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Ian Marsh, a Director of investments at Brighton-based financial adviser Peel Townsend Financial Services, warns that it is very irresponsible of people not to have Life Cover and/or Critical Illness Insurance as he maintains that life has 2 main dangers – either being alive too long and passing away too early.  “Its imperative to have some insurance in place – especially if you have got young children,” he states. “These days you must construct your own little welfare state because nobody else is can do it for you.”

Justin Peters at LifeSearch says now is the right time to buy such plans as there are some very reasonable premiums about owing to the fierce competition for business within the market. “The cost of life insurance has fallen – dropping about forty per cent in four years. It has never been so cheap,” he states. “The critical illness insurance market paid out on 85 per cent of claims in 2006 – increasing from eighty per cent  the during the last year.”

Be aware of what insurance cover you already have before you take out any more.  Do you already have investment policies or does your company pension plan give you any cover?

The best way to calculate how much insurance you will need is to work out how much you would need to have the same level of living over a year and then times it by 24 years.  The minimum amount required should clear all outstanding debts and provide a lump sum for all your dependants.

Make sure you get a really good deal

When making a decision on your insurance policy it is very important to read the manual that many insurance companies have of the conditions and illnesses that they deal with. It will catalog everything and should be strsightforward and simple to grasp.  You will also want to review the documentation of the crutial features of the policy which will take account of all exclusions and benefits.

When people take on the responsibility of a homeowner loan they are usually advised to take out critical illness insurance but should research the market and not just take the first insurance policy proposed.

If you start paying these premiums when you are younger they are a great deal cheaper, distinctly different to leaving it until you are older, when cover increases quite markedly.

Insurance payments can also be lowered by quitting smoking cigarettes.  April Holmes, manager of protection insurance at Thisismoney says ” as well as giving a longer and healthier quality of life, giving up smoking can save people a vast amount of money.”

If you quit smoking you can knock as much as a 1/3rd off life, critical illness cover and income protection insurance premiums because the evidence that we now have proves that smoking can trigger serious illness and intensifies any other existing health conditions.

If your circumstances change you may have to alter your policy.

Under no circumstances think that once you have bought your insurance policy that you can just carry on with your life and forget about it. constantly be very aware of the insurance policy you have and ensure that, should your circumstances alter, or, is about to alter your policy must accommodate these revisions.  Perceivable examples are moving jobs, or or maybe you would like to have more children; often think about everything that may put up your living expenses and would need to be covered if you cannot work.

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