Trauma Cover

What’s the difference between trauma cover, life insurance trauma cover, and income protection?

Well, let’s start with the basics.

What is Trauma Cover?

Trauma cover is a type of policy that pays out a lump sum if you should be the victim of a critical illness or serious injury. While the specifics change from insurer to insurer, this lump sum can be used to support you while you recover, whether this means covering your costs like rent and food while you’re unable to work, or specialised health car that falls outside the public system. Critical illnesses can include ailments ranging from cancer to a head injury, this is why Trauma Cover is sometimes called Critical Illness Cover or Recovery Insurance.

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What is paid for by Trauma Cover?

You can use your lump sum for a range of things, specifics will be spelled out for you in detail in your policy so be sure to read it carefully.

Some common things that Trauma cover can pay for are:

medical costs that are out of pocket or specialists
your family’s living costs for the duration of your inability to work
keeping you in good standing with your existing debts such as mortgages
accessibility additions to your living space, such as rails, ramps, or special furniture
therapies, nursing, or specialised transport such as medi-taxis

Does Trauma Cover Insure You for Mental and Emotional Trauma?

No, Trauma Cover refers to physical trauma and illnesses not mental health conditions, or the emotional effects of a traumatic experience. For mental health treatment and support you might consider specialised private health insurance.

What is Life Insurance Trauma Cover?

Income protection covers you for a range of things that Trauma Cover doesn’t necessarily, and generally pays out in a different way. Trauma Cover is a lump sum, whereas Income Protection usually just takes care of your monthly expenses while you’re unable to work. Trauma Cover generally only pays out for major incidents, whereas Income Protection can cover you for a range of things that prevent you from working -though each policy is different.

What’s different about Trauma Cover from Income Protection?

Life Insurance and Trauma Cover are two different things, though sometimes are conflated as the two are sometimes bought together.

Life insurance pays a sum to those you leave behind when you pass, this can include end of life expenses, such as the funeral and burial costs which can add up quickly, taxes on wills and inheritance. Life insurance may also pay out if you are diagnosed with a terminal illness, every policy has specific differences.

Things to keep in mind when you get your Trauma Cover quote

Your Trauma Cover quote should include specifics about the way your cover is structured, how and when it will pay out, and what the terms and conditions are for each type of trauma cover insurance.

Remember that not all trauma cover insurance policies cover the same things, so if you work in a certain line of work and the trauma cover insurance offered through that job specifies an industry risk factor as covered, not every policy you see advertised will also cover that elevated risk factor.

You may have Trauma Cover included, or replicated in another form, in your other insurance policies.