Parents who want more cover for their children will now be able to choose a new paid-for option from Legal & General.
L&G has launched the Children’s Critical Illness Extra (CCIx) to covered children from birth.
There is no limit to the number of children a parent can claim for and the child is protected until the age of 22, irrespective of whether they are in full-time education or not.
Craig Brown, director for intermediary at L&G said: "Dealing with a critical illness is extremely challenging for anyone, but when it is a child, this makes it particularly distressing.
"The UK still suffers from a significant protection gap and there is a serious risk of leaving children exposed and parents vulnerable to financial difficulty if either suffer from a critical illness."
As part of the optional add-on, L&G will pay 50 per cent of the amount of cover, or up to £25,000 for a valid claim.
As well as all the original benefits covered as part of Children’s Critical Illness Cover, CCIx includes a new children’s terminal illness benefit, providing cover of £10,000 if the child is diagnosed with an advanced or rapidly progressing incurable condition, with a life expectancy of less than 12 months by the hospital consultant and L&G medical officer.
An additional 12 illnesses are covered under CCIx including cystic fibrosis, Crohn’s disease, spina bifida, Down's syndrome and type one diabetes.
L&G has also enhanced its Children’s Critical Illness Cover, and new services include covering children from 30 days and extending the maximum age of cover from 18 to 22.
It has reduced the survival period from 14 to 10 days and increased the child funeral benefit from £4,000 to £5,000.
Adam Higgs, head of adviser services at F&TRC, has welcomed L&G attempt to broadened its children’s critical illness by offering clients the choice of standard or comprehensive cover.
He added: "Children's claims are now commonly the fourth most claimed upon area for critical illness cover. Legal & General has increased their maximum age and decreased the required survival period, which improves their positioning in terms of quality for a company that is traditionally known for being very competitive on price.
"However, the ability to remove children’s cover altogether has not been provided, which can be important for those who don't have nor plan to have children. Some insurers, such as Royal London, are more flexible in this regard."