Get a year's free critical illness cover

One insurer is offering 10,000 applicants free critical illness insurance for a year.

Critical illness cover can be a very useful form of insurance. It means that if you get sick with a certain type of illness, you will receive either a lump sum or a regular monthly income.%VIRTUAL-SkimlinksPromo%
And one insurer is offering 10,000 people the chance to get the cover for a year without paying a penny.

A year's free cover
Insurer Bright Grey is turning ten years old, and to mark the occasion it is offering a year's free critical illness cover, worth up to £20,000, to 10,000 people.

It will be offered to the first 10,000 people who apply for life cover under its personal protection menu from 22nd April.

Who needs critical illness cover?
Critical illness cover, much like life insurance, is not for everyone. It's there to cover for your living costs should you suffer an illness, but you may have a lot of money set aside in savings to cover such an eventuality.

Equally, you may be fortunate enough to have an employer who offers a great benefits package In the event you need time off, or a partner who can cover your living costs should you not be able to work for a while.

However, if that doesn't apply to you, you will need to work out what you would do if you got sick. Critical illness insurance may be a wise safety net to go for.

What does it cover?
Another important thing to consider is that not all critical illness policies are the same. You know where you are with life insurance – if you die during your term, your family will get a payout. It's not that simple with critical illness insurance.

Let's take an example. I've just switched critical illness policies. My old policy offered cover on 27 different illnesses. However my new policy offers cover on more than 40, including prostate cancer, Chron's Disease and encephalitis, none of which were covered with my old policy.

So it's really important that you don't just compare on price when picking a policy and read the small print too.

What will it cost me?
Which brings us neatly on to the cost of critical illness cover. You almost always buy critical illness alongside life insurance, rather than as a separate standalone policy, so in the example below I'm going to look at quotes for decreasing term life insurance with critical illness.

This is cover where the exact amount you would receive decreases over time, a popular type of cover for people with mortgages.

Let's take the example of a 30-year old male non-smoker who wants £200,000 of cover for a 30-year term, using Lovemoney's life insurance engine.

£30 a month for that level of peace of mind strikes me as pretty good value. Of course, you will need to look at exactly what is covered in each policy before signing on the dotted line.

Non-disclosure and making a successful claim
Critics will point out that some insurers have a disappointing payout rate on their critical illness insurance. Indeed in 2011 Scottish Widows paid out on just 87% of claims, leaving many policyholders upset.

The main reason claims are turned down is non-disclosure. This is where the person who is taking out the critical illness insurance doesn't tell the insurer something relevant at the time of application. It may be lying about when you last had a cigarette to failing to mention a previous illness or injury.

To try to reduce the number of claims that are refused for this reason, new rules have been introduced to force insurers to ask more relevant questions. To find out more, check out New law makes it easier to make a successful insurance claim.

And if you want to make sure your insurer doesn't say no, read Make a successful claim on your critical illness insurance.

You might also want to consider taking out a different form of insurance called income protection insurance, either as a supplement to critical illness cover or as an alternative. Read this guide for more information.

Do you have critical illness insurance? Do you think it's good value for money? Let us know your thoughts in the comment box below.

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10 consumer rights you should know
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Get a year's free critical illness cover

The law states that any goods you buy from a UK retailer should be of satisfactory quality, as described, fit for purpose and last a reasonable amount of time.

This applies even if you buy items in a sale or with a discount voucher. You may have to insist on these rights being respected, though.

Useful phrases to use when you want to show you mean business include, "according to the Sale of Goods Act 1979" and, if it's a service, "according to the Supply of Goods and Services Act 1982".

Some shops will allow you to exchange goods without a receipt, but they can refuse to should they wish.

If the goods are faulty, however, another proof of purchase such as a bank statement should work just as well.

If you attempt to return goods within four weeks of the purchase, your chances of getting a full refund are much higher as you can argue that you have not "accepted" them.

After this point, you can only really expect an exchange, repair or part-refund.

The updated Consumer Credit Act states that card companies are jointly and severally liable for credit card purchases of between £100 and £60,260 (whether or not you paid just a deposit or the whole amount on your card).

Anyone spending between these amounts on their credit card is therefore protected if the retailer or service provider goes bust, their online shopping never arrives or the items in question are faulty or not as described.

Start by writing to the agency asking it to either remove or change the entry that you think is wrong. It will investigate the matter and find out whether you have been the victim of ID theft or a bank's mistake.

Within 28 days from receipt of your letter the agency should tell you how the bank has responded. If the bank agrees to change the entry, they will authorise the agency to update their records. They should also send updates to any other credit reference agencies they use.

You can also contact your lender directly to query a mistake. If the lender agrees to the discrepancy, ask them to confirm this in writing on their letterhead and send a copy to the agency, asking them to update your file.

The FOS settles disputes between financial companies such as banks and consumers.

If a financial organisation rejects a complaint you make about its services, you can therefore escalate that complaint to the FOS - as long as you have given the company in question at least eight weeks to respond.

The FOS will then investigate the case, and could force the company to offer you compensation should it see fit.

Bailiffs are allowed to take some of your belongings to sell on to cover certain debts, including unpaid Council Tax and parking fines.

They can, for example, take so-called luxury items such as TVs or games consoles. However, they cannot take essentials such as fridges or clothes.

What's more, they can only generally enter your home to take your stuff if you leave a door or window open or invite them in.

You are therefore within your rights to refuse them access and to ask for related documents such as proof of their identity. If they try to force their way in, you can also call the police to stop them.

Private sector debt collectors do not have the same powers as bailiffs, whatever they tell you.

They cannot, for example, enter your home and take your possessions in lieu of payment.

In fact, they can only write, phone, or visit your home to talk to you about paying back the debt. As with bailiffs, you can also call the police if you feel physically threatened.

Thanks to the Distance Selling Regulations, you actually have more rights buying online or by phone than on the High Street.

You can, for example, send most goods back within a week, for a full refund (including outward delivery costs), even if there's no fault.

You will usually need to pay for the return delivery, though. The seller must then refund you within 30 days.

We enter into contracts all the time, whether it be to join a gym, switch energy supplier or take out a loan.

In most cases, once you've signed a contract, you are legally bound by it. In some situations, however, you have the right to cancel it within a certain timeframe.

Credit agreements, for example, can be cancelled within 14 days. And online retailers must tell you about your cancellation rights for any contract made up to stand up legally.

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