This type of cover I am extremely passionate about. I know it's difficult to think about because as Kiwis we are bought up to be tough and resilient and have developed the "It'll be alright" and the "It won't happen to me" attitude. Unfortunately I've seen first hand what can happen to individuals, businesses and families when the unimaginable hits - not just emotionally but financially. So my advice? is simple - get it!
What is trauma insurance cover?
Trauma cover, also known as critical illness cover, provides you with a lump sum payment which will cover you if you are diagnosed with a critical illness or injury (and survive 14 days)..
How does trauma insurance work?
Thinking about having a critical injury or illness isn't easy, we get that. Unfortunately, a critical illness has the power to turn your life upside down. Think about what would happen if you were forced to take time off work, or what would happen to your family – would you need financial support?
If you're diagnosed with a critical illness, trauma insurance pays out in a lump sum. You choose how much money you'll be paid out when you apply for your cover. Think about trauma insurance as the ambulance at the top of the cliff, If you were to be diagnosed with one of the conditions below, you'd get paid the lump sum amount.
What conditions are covered by trauma insurance?
The insurers we work with at will have some differences as to what they cover. Most trauma policies will have a list of 40 or so specific conditions. There's a bunch of standard conditions that will be covered, for example, cancer, heart attack, stroke, and terminal illness to name a few medical conditions. A good policy will include partial trauma payments for a less severe trauma event.
How much do you get paid out?
You get to choose your level of cover and how much your lump sum benefit will be. The best way
to go about choosing is to think about what would happen if you were no longer able to work, and how many people depend on your income. A key thing to think about when choosing your cover amount is whether you can afford to take time off work to recover. For example how much would you need to live comfortably for a year if you suffered a trauma event.
The past couple of months I have had four trauma claims, The youngest claimant has been 32 and the oldest 55. This illustrates the old notion "it can happen to anyone". They have used these funds to take time of work to focus on recovery and family time. Without their trauma payment they would have had to return to work early because of the added financial pressure of having to provide for their family. A trauma payment also means the spouse has the option of taking time off also.