Critical illness (CI) cover pays a one-off, tax-free lump sum if you are diagnosed with one of the conditions specified in your policy and survive a defined period after diagnosis (usually 14–30 days). Unlike income protection, the payout is not linked to your ability to work: it is triggered by the diagnosis itself.

You receive the money as a single payment and can spend it on anything you choose: paying off a mortgage, adapting your home, funding private treatment, topping up an income protection policy, or simply buying time to recover without financial pressure. There are no restrictions on how the money is used.

The following are illustrative examples only. They do not represent real clients or actual cases. Individual policy terms, eligibility and outcomes will vary.

Heart attack at 48: mortgage cleared

Richard suffered a heart attack at 48 and faced 3 months off work followed by a phased return. His CI policy paid a £150,000 lump sum on diagnosis: enough to clear the mortgage completely. With that pressure lifted, he recovered without financial anxiety and never had to return to work before he was truly ready.

Stroke at 52: home adaptations funded

After a stroke left Clare with reduced mobility, she needed significant adaptations to her home: a stair lift, wet room conversion, and a downstairs bedroom. Her CI payout funded all of this within weeks of diagnosis, meaning she came home from hospital to a house that worked for her new needs.

Breast cancer diagnosis: time to focus on treatment

Nadia, 43, was diagnosed with breast cancer while working part-time and managing childcare. The CI lump sum meant she didn't have to worry about money during treatment: she could focus entirely on recovery, pay for private aspects of her treatment not covered by the NHS, and arrange childcare properly.

Most comprehensive policies cover 40–100+ conditions in total, often split into full-payment and partial-payment tiers. Partial payments (typically 25% of the sum assured up to £25,000) can be triggered by less severe diagnoses such as low-grade prostate cancer or early-stage conditions. Baker Hudson Health compares policy definitions (not just premiums) to find the most comprehensive cover for your budget.

Critical illness cover is a one-off lump sum on diagnosis: ideal for clearing debt, funding home adaptations, or covering costs during treatment. It doesn't require you to be off work and pays regardless of recovery.

Income protection pays a regular monthly income if illness or injury prevents you from working: ongoing until you recover or retire. It covers a far wider range of conditions including mental health, back problems and anything that keeps you off work, but doesn't pay a lump sum.

The ideal solution is often both. A heart attack might trigger a CI lump sum to clear debt and fund recovery, while income protection provides ongoing monthly income if you can't return to work immediately. Combining them creates a comprehensive financial safety net. Baker Hudson Health will show you how both products work together and whether a combined life and CI policy makes sense for your budget.

Most CI policies extend cover to your children at no extra cost: typically covering children from 30 days to 18 years (or 21 if in full-time education). The children's benefit is usually a percentage of the parent's sum assured (commonly 25–50% up to £25,000–£30,000).

Children's CI cover can pay for private treatment, home adaptations, or simply allow a parent to take time off work to be with their child during diagnosis and treatment: without financial pressure. When comparing policies, the breadth of children's cover (and whether it's included or costs extra) is a key differentiator.