What's Trauma insurance, and why would you want it?
Trauma insurance can help families survive financially, or cover the cost of medical treatment, if you suffer a significant illness or injury.
By Robyn Bartlett
Product Manager, Asteron Life
Trauma cover can be one of the most confusing personal insurance products on the market, and it can be hard to understand why it’s useful when compared to life insurance or income protection cover.
But if you ever end up in a situation where you need to claim on your Trauma cover, it is likely to be one of the most valuable insurances you’ll ever have.
Here’s a little more information about what Trauma cover is, and how you can use it.
What is Trauma cover?
Sometimes called other names like Critical Illness cover, Trauma covers specific conditions and illnesses that can have a significant impact on your life.
Asteron Life’s Trauma Policy covers 48 specific conditions and procedures, and each one has a medical definition that you must meet, in order to receive a pay-out. You can choose your own sum insured, which can be anywhere from $10,000 to $2 million.
5 ways you can use Trauma cover
One of the most valuable things about Trauma cover is that it is always paid out as a lump sum. That means there is no ongoing claim criteria you need to meet, and it gives you the financial freedom and flexibility to spend the payment however you like.
There are a few main ways that our customers spend their Trauma cover.
1. Paying for medical treatment
If you’re suffering from a treatable illness (like some cancers), it sometimes happens that your condition doesn’t respond to Government-funded treatments in New Zealand.
If that happens, you can use your Trauma payout to pay for treatment options that aren’t funded by Pharmac.
2. Modifying their home
Some of the conditions covered by Trauma cover are things that will permanently alter your life, like blindness or types of paralysis.
You can use a Trauma pay-out to modify your home, like installing ramps or disabled showers that will allow you to continue to live your life to the fullest possible extent, in the place you’re most comfortable.
3. Spending time with family
If you’ve suffered an illness or injury, sometimes what you want most is to have your family around you.
Trauma payouts can give you the financial freedom to allow your partner or family to take time off work to help you recover and rehabilitate, or even just to spend time with you.
4. Taking some pressure off their finances
Significant medical events can mean time off work and disrupted finances.
Sometimes income protection cover will help, but if you don’t have it or you’re still earning an income while you recover, Trauma payouts can help you take care of bills and living expenses.
5. Ticking some things off the bucket list
Trauma is such a flexible cover that often our customers don’t use it to do anything related to their condition – they use it to realise the dream of a lifetime.
Whether that’s a new car, a round the world trip with your family or building a new holiday home like this customer, the choice is yours.
Deciding if you need Trauma cover
As with all life insurances, you need to decide if Trauma cover is right for you.
If you’re not sure, chat to your financial adviser about Trauma cover. They can talk you through the conditions that are covered, optional benefits that are available and the policy structure and sum insured that will best suit your needs and your budget.
If you don’t have an adviser, we can help you find one.