Child critical illness cover payout and UC £16000 threshold

I am a Carer for my disabled wife and receiving benefits.

My son recently was diagnosed with a medical condition that falls under the Equality Act 2010. I have contacted my insurance company whom I have a critical illness cover with, they have advised me that a child cover element was also included in the policy and that my child is eligible to make a claim.

I would like to make a claim under the Critical Illnesse child cover element of the claim , the payout would be for his furture care and needs, however as we receive benefits the payout amount would push us over the benefits threshold of £16000.

I have asked the insurance company if the payout can be made to my 21 year old sons bank account directly to avoid any issues with DWP, eg potentially having mine and my wifes disability payments stop if the money was paid into my bank account directly, as the payout money is for my sons care and needs and not for us his parents, and that it is my son who is making the claim under my policy under the Child cover element of the policy.

The insurance company said they normally pay the money to the policy holder ie myself.

My son is now fearful that if he claims the child element of the critical illness cover that me and my wife will lose all our benefits.

How do we tackle this situation