Trauma insurance, also known as critical illness cover, provides a lump sum of money if you suffer from a specific illness. It covers you for major events such as blindness, cancer, kidney failure and multiple sclerosis. It is different to total and permanent disability cover because you don’t have to be totally and permanently disabled to make a claim.
Why is trauma insurance important?
Trauma insurance can protect you if you suffer from a major medical event. If you are diagnosed with an illness such as cancer, you may require time off work and be treated by the best available doctors, which can come at a huge financial cost.
Wouldn’t it be nice to have access to a lump sum of money to replace income if you are unable to work, to help cover medical expenses or to allow you time to recover and be with your family?
Even if you have income protection insurance, it is still important to insure yourself for trauma insurance as income protection generally only pays up to 75% of your current income. Also, you may need extra money to help pay large medical bills or other expenses.
Can it happen to you?
Don’t think it can’t happen to you? Look at the statistics on just one area of illness – cancer.
An estimated 114,000 new cases of cancer were diagnosed in Australia in 2010. One in two Australians will be diagnosed with cancer by the age of 85. The most common cancers in Australia (excluding non-melanoma skin cancer) are prostate, colorectal (bowel), breast, melanoma and lung cancer.
The rate of new cases of lung cancer among women has risen while the rates for men have fallen, according to a report released by the Australian Institute of Health and Welfare (AIHW) and Cancer Australia. The report shows the number of new lung cancers increased markedly in both sexes between 1982 and 2007.
What about trauma insurance for children?
Trauma insurance should also be considered for children once they reach age two. If your child suffers a major illness or injury, either you or your partner will most likely want to take time off work to be with and care for your sick child.
Your child may require surgery, hospitalisation and further ongoing treatment. These expenses can mount up and you may be earning less income if you can’t work.
Without covering a child for trauma insurance your entire family may be subject to financial difficulties. How would you continue to pay your mortgage repayments and other expenses such as schooling, power bills and groceries if you are no longer working?
Trauma insurance can only be added to an adult’s policy, so if you have trauma cover for yourself you can also add your children to the policy. The cost of child trauma cover is usually very affordable.
What action should you take?
Speak to your financial planner today to review your insurance needs. Your planner can recommend the types of cover you need any how much you need to be insured for. The range of policies and features on each policy can vary widely. An expert can help to navigate through the maze so you get the cover you need.
Speak to our Certified Financial Planner – Frank Santagada CFP® Dip FP AFB C.Dec
Contact us on 07 4775 5199