Why Trauma Insurance Is Important

Many individuals and families do not have trauma insurance, and a great majority of Australians do not realise the importance of such cover. Private health insurance is fast becoming accepted as a necessary requirement for every day life but insuring yourself against an incurable condition or serious accident is often overlooked.

Trauma insurance, which is also known as critical illness insurance, can cover you against things such as heart attack, stroke, cancer and major head injuries. The policy pays a pre-agreed amount when the person who’s insured is diagnosed with a condition that is listed on the policy.

As well as the already mentioned conditions, the trauma policies might also include lung disease, multiple sclerosis, blindness, coma, motor neurone disease, loss of limbs, chronic kidney failure, alzheimer’s disease, muscular dystrophy, severe burns and many more. You can customise your policy to suit your needs and budget, with minimum cover policies being the most common. They generally cover cancer and heart conditions.

Trauma cover fills the void between life insurance, disability insurance and income protection. Life insurance only assists your family after you die, and will not cover you for injuries or illnesses while you’re alive. A trauma insurance policy covers you while you’re alive, and is paid out to the owner of the policy, which is usually (but not always) the individual who it’s insured for.

Trauma cover pays a once-off lump sum, with no ongoing payments made. Once I payout has been made, the policy terminates. Cost from company to company can vary, and there are different payment options. If you are younger, you can choose to pay a lower annual premium which will increase as you get older. Alternatively, some policies let you lock in a fixed annual rate which will not change as you age. Whilst the first option saves you money initially, over the length of the policy the second option will work out cheaper.

The payment can be used for a number of things, which if not insured, can cost a great deal and cause heavy financial stress on most normal households. The payout can be used for specialist medical treatment, both within Australia or overseas. It can also pay for any necessary modifications to the house, such as ramps, lifts and rails, if the accident or illness causes physical disability. If you have ongoing mortgage repayments or credit card debt, the money can be used to take care of these. This is particular helpful if you are unable to work for any length of time.

In some cases your partner may need to take time off from their own employment, in order to provide care around the house for you. The payout can also assist in supplementing their reduced income, as they stay at home to give you medical attention. Whatever the case, trauma insurance is a smart investment to protect yourself, and your family, against unforeseen traumatic events in the future.