The hidden costs of serious illness
Being diagnosed with a serious illness can impact more than someone’s health. It can often lead to multiple financial pressures, meaning they need to stop or reduce work, combined with additional costs like hospital parking and childcare. You and your clients might be surprised at how much the combined impact can add up.
How might a serious illness impact a client and their family? Health and emotional issues often come to mind first. But then realisation can dawn about the financial impacts too. “What if I’m too ill to carry on working? How will we cope?” It may take a while to uncover and understand all the hidden costs of being seriously ill.
The stark realities
Nearly one in two of us will get cancer in our lifetimes, according to Cancer Research1. And the UK is projected to lose the equivalent of 170,000 full-time workers to cancer each year between 2023 and 2050.1
So how will those 170,000 people be able to pay their mortgage or rent and cover their bills? Some of them may well be your clients. And in many cases, their partner, if they have one, may need to reduce their working hours to look after them or attend appointments – cutting household income further.
According to the most recent cancer costs report from Demos2
- 48% of cancer patients make structural changes to their working patterns because of their illness
- 53% of cancer patients see their income fall at least one income bracket
- 20% of cancer patients were supported by a family member or friend who had changed their working patterns to offer care
And it’s not just cancer. Many people may need to reduce their hours, stop working or retire early due to stroke, serious heart problems and other critical illnesses. Their caregivers may need to reduce their working hours too.
But loss of income isn’t the only problem. People with a serious illness, or in recovery from a serious illness, can face big additional costs, such as:
- Travel to hospital appointments
- Rehabilitation
- Care costs – both short and long term
- Hospital car parking
- Energy bills if someone is spending more time at home or needs to keep the home warmer
- Travel insurance
- Prescriptions – if not entitled to free prescriptions
Clients may need to travel to hospital by taxi due to exhaustion or because they have a compromised immune system and have been advised to avoid public transport.
Some illnesses may require adaptations which cost money, such as:
- Special diets
- Home adaptations
- Specialist equipment
- Adaptive clothing
Home adaptation might include major things like making doors wider for wheelchairs, swapping baths for walk-in showers or adding a stair lift. Minor adaptions could include adding handrails or an intercom to answer the door. Then there’s other costs for mobility, such as purchasing a mobility scooter or electric wheelchair which often aren’t funded.
How it adds up
Let’s take three different illnesses to see how these impact people’s financial situation: Parkinson’s, Motor Neurone Disease and Cancer. Because available stats tend to be a few years old, bear in mind that the real figures are likely to be higher now due to the increased cost-of-living.
Parkinson’s – The latest report from Parkinson’s UK showed that the average household where someone has Parkinson’s is £16,582 out of pocket a year.3Of this, £3,622 went towards social care costs such as home adaptations, equipment to enable people to stay independent and assistance with daily tasks such as cleaning and shopping. Additional household costs have been confirmed in more recent international studies too.4
Motor Neurone Disease (MND) – Similarly, households affected by MND spend an average of around £14,500 a year5 above and beyond normal living costs. These additional costs can include anything from the cost of equipment and housing adaptations to increased energy bills.
Cancer – In June 2025, just 67.1% of cancer patients were treated within 62 days of referral – significantly below the NHS target of 85%6. Some of these people won’t have been well enough to work. 83% of people living with cancer are £570 a month worse off on average,7 according to Macmillan Cancer Support. And cancer charity Maggie’s found that the unexpected additional costs of cancer are closer to £900 a month.8
“45% of people are taken by surprise by the extent of the financial impact of their cancer diagnosis.” Macmillan Cancer Support/Truth online survey7
How HSBC Life Critical Illness Cover can help
We’ve recently enhanced our Critical Illness Cover for new customers to help deal with the financial impact of a diagnosis we cover.
For example:
- NHS waiting lists – Customers can now claim when they are placed on the NHS waiting list for surgery for 39 qualifying conditions* – they don’t have to wait for the surgery to actually take place.
- Enhanced critical illness definitions –we want to be clearer what people are covered for and provide broader, improved cover, such as increasing the accidental hospitalisation payout on CI Plus from £5,000 to £50,000 or 50% of the sum assured (whichever is lower) for valid claims.
- Top up payments (up to age 60) with payouts that reflect the financial obligations of working-age clients. On CI Plus this offers an extra payment of £200,000 or the sum assured (whichever is lower) if a claim is made for one of nine listed conditions.
- Pregnancy complications –additionally on CI Pluswe’ll pay out £5,000 if the policyholder or their partner are diagnosed with one of seven different types of complication**.
For full terms and conditions including limitations and exclusions please refer to our policy booklets.
To access useful adviser resources and support please visit our website.
Other financial help in times of serious illness
Citizens Advice say that from their analysis it’s clear that the current Statutory Sick Pay rate (now £118.659) is not sufficient to protect people against financial hardship during periods of illness.10 Nor do many people realise that standard Universal Credit pays £316.98 a month if you’re single and under 25 and up to £628.10 if you live with a partner and one of you is 25 or over11. The amount will increase if you have children or have limited capability for work. However, for many people, Universal Credit would be insufficient to cover their regular household costs.
How advisers could help
Being able to discuss some of the potential financial impacts of critical illness could help clients make good decisions about taking out protection to safeguard their future.
The hidden costs of critical illnesses are all too often not appreciated until someone is already on that journey. Your client could then truly discover the practical benefits of critical illness cover. Especially when you consider that the average claim for critical illness was £68,735 for 2024, according to the ABI.11
And you’ll also be reassured to know that our claims team will deal with any claims quickly and empathetically. HSBC Life customer Sam shares her positive experience of claiming after a grade 2 breast cancer diagnosis in this short video. You may want to share the video with prospective clients considering critical illness cover.
Take a look at the changes we have made to Critical Illness Cover – and how these enhancements provide good customer outcomes – on our adviser website.
You can also join a webinar or talk to your BDM to find out more in person.
References:
*38 adult conditions on our CI Plus product and congenital heart disease on Children’s CI Plus.
**A partner is someone the policyholder is married to or in a civil partnership with, or someone they have been living with for a minimum of two years as if they were married or in a civil partnership. The policy must have been in place for 9 months before a claim can be made.
- The cost of cancer: what does it mean for the UK economy? – Cancer Research UK
- Demos Cancer Costs
- Cost of Parkinsons
- The financial impact of Parkinsons has also been confirmed more recently by the study: Economic Burden of Parkinson’s Disease: A Multinational, Real-World, Cost-of-Illness Study. Drugs Real World Outcomes. 2024
- Through the Roof MND Association report 2023
- BMA NHS backlog data analysis to June 2025
- Cancer a Costly Diagnosis, Macmillan Cancer Support
- Maggie’s Hidden Cost of Cancer
- Statutory Sick Pay GOV.UK
- Citizen’s Advice: In sickness and in health: Why Statutory Sick Pay needs further reform
- As at 01/10/2025: Universal Credit: What you’ll get – GOV.UK
- Protection insurers pay out record £8 billion to support individuals and families, ABI