A suitable case for treatment

You are not obliged to have any kind of health-care cover. Millions don't, and many end up paying the price. Every day in the UK, 800 people have heart attacks, 700 are diagnosed as cancer sufferers, and 300 have strokes. While medical advances mean the chances of survival are improving, few victims are prepared for the financial implications of such diseases.

Nearly half of all heart attack victims survive for another 13 years, according to Employers Reassurance International, an insurer, while three- quarters of stroke victims under 55 survive for more than a year. The Cancer Research Campaign says that 40 per cent of cancer sufferers aged between 35 and 54 will survive for at least three years.

But many victims are unable to work again, or need expensive medical treatment. Preparing for such eventualities, by having the right health insurance in place, does at least offer some peace of mind.

There are various kinds of health cover available: private medical insurance (PMI), critical illness, and permanent health insurance (PHI) Generally, policies are expensive and few can afford complete cover. You need to decide what kind of insurance is important for you.

"PMI ensures that expert treatment is available where, and more importantly when, you need it," says Ailie Ferrari of Sigma Healthcare. Long waiting lists and the perception of reduced NHS cover is forcing more people to consider PMI. On the back of these worries, insurers now offer budget policies with fewer benefits. Decide the level of cover you want before asking how much it costs.

Permanent health insurance is very different: it pays a regular income if, after illness or accident, you are unable to return to normal work. Its cost is determined by age and the level of cover required, and it is very sensitive to earnings - insuring an income of pounds 20,000 a year costs a lot more than insuring pounds 5,000. The key is to calculate how much you will need if you can't work. That amount is likely to be considerably less than you actually earn and will reduce the cost of PHI.

Critical illness insurance is similar to life cover, except that it pays out a lump sum while the policyholder is still alive. Different critical illnesses are covered by different insurers, but all policies include common ailments such as cancer or heart disease. The cash paid out can be for any purpose, such as a holiday. In reality, however, it is likely to be used to pay the mortgage, or for health care or nursing or even modifications to the home to help make life easier.