5th October, 2021

Trauma Insurance

Trauma Insurance, sometimes known as Critical Illness or Crisis Recovery Insurance is the lesser known of Life Insurance cover. A lump sum payment from your Trauma Insurance policy gives you the financial security in the worst of times. It allows you the financial freedom to access the best medical treatment available, pay for your rehabilitation, and cut back on your work hours to concentrate on your recovery, and can assist with medical and rehabilitation costs you may face such as a serious injury or illness including but not limited to cancer, heart attack, stroke, amputation, major head injury etc. there are around 45 events that are covered.

There are a list of insured events with varying degrees of benefit, Trauma Insurance will not cover mental health conditions.

The first Trauma insurance product was founded by Dr Marius Barnard with the first being launched on 6 October 1983 in South Africa under the name Dread Disease insurance.

This form of insurance originally covered four primary health conditions.

  • Cancer
  • Stroke
  • Heart attack
  • Coronary bypass surgery

Since 1983, the cover has been accepted into many insurance markets around the world.

The lump sum payment payable in the event of an insured trauma event can assist with out-of-pocket medical costs, cost of additional therapies, care or special transport and changes to housing if needed. While it could also assist with things like cost of living expenses and debt repayment if you’re unable to work, this is not the intention of Trauma Insurance and costs could be very high to cover these needs under a Trauma Insurance policy compared with the use of a Total and Permanent Disability (TPD) and / or Income Protection policy.

When you’re deciding if you need Trauma Insurance and how much it’s important to consider if you have other covers such as Total and Permanent Disability (TPD) or Income Protection policy, how much support you may have from family, Trauma insurance can be held on its own as a stand-alone policy or linked with Life Insurance and TPD Insurance. Linking the Trauma cover could mean that your Life and TPD covers would be reduced by any amount paid out in a Trauma Insurance claim (read more).

If you would like to request further information regarding Trauma Insurance please call and speak with our Life Insurance Adviser, Chris Earle.

Author: Murray Bruce