Trauma Insurance & Critical Illness Insurance

We never know what lies around the corner for us. Chances are you or someone you know has experienced some sort of medical trauma that has turned a life upside down in an instant. In such a circumstance, there are many variables to consider and financial support is an integral part of how you move forward.

Trauma insurance also known as Critical Illness insurance is a policy which pays a non-taxable lump sum benefit to give you extra financial support if you develop any one of a range of specified medical conditions such as a heart attack, stroke, qualifying cancers, a severe injury or loss of independent living. 

Learn how trauma insurance works. Contact MyFuture to help you protect you and your family income due to a serious illness or injury.

What is Trauma Insurance?

Trauma insurance is a policy that will pay out a lump sum for you or your children should you face serious illness or injury. It is designed to support you to manage the financial impact of covering any medical treatments or rehabilitation costs. 

During what is undoubtedly a stressful and traumatic time, you can use your trauma insurance payment to provide care to you and your family, while you focus on your recovery and quality of life. One of the main benefits of a trauma insurance policy is its flexibility, the lump sum payout allows you and your family to determine where that money goes and where it is most needed.

While some forms of health insurance may cover many expenses related to the types of conditions covered by trauma insurance, you can often incur additional expenses that are not necessarily covered by any health insurance policy. If you have income protection or total permanent disability insurance they could potentially help replace any loss of income. A trauma insurance policy can work in conjunction with any other policies you already possess.

Do I Need Trauma Insurance?

We hope you have never or will never have to experience the terror of facing a traumatic experience for you or a loved one but chances are you know someone who has. Unfortunately, it’s not all that uncommon. Have you ever sat back and considered what you would do in a scenario like this? How you or your family would cope with such an incident? 

Something such as a heart attack or cancer diagnosis can really take its toll on your emotional wellbeing but we don’t always take into account the financial aspect of it. Ask yourself if you and your family would be able to take on the additional financial burden should one of you face a medical emergency.

You may need benefit from trauma insurance if:

  • Your family is dependent on your income.
  • You have a mortgage or other personal loans that require regular payments.
  • You have limited savings or an emergency fund to cover expenses if you’re unable to work.
  • You have a business with ongoing overheads.

What to Look for in Trauma Insurance Policies?

If you’re considering a trauma insurance policy for you or your loved ones then there are certain factors of each policy to compare, such as:

  • Coverage – which conditions are covered and how does the policy define them?
  • Exclusions – what isn’t covered by the policy?
  • Premiums – How much will the policy cost you and will the premiums increase? Increased premium cover is called ‘stepped cover’ if it stays the same it is called ‘level cover’
  • Benefit amount – What will be the payout amount in the event of a successful claim?
  • Waiting periods – Some insurers impose waiting periods before you can make a claim.

Talk To One Of Our Expert Trauma Insurance Advisers Today

If you are after some advice around trauma insurance, feel free to reach out to one of our friendly advisers who will be more than happy to help

What Does Trauma Insurance Cover?

The specific conditions covered by a trauma insurance policy will vary between different insurance providers. It’s important to do some digging to find out precisely what is covered in your policy. The product disclosure statement of the policy will provide the details regarding the coverage you purchased and just as importantly, what is not covered.

Most comprehensive policies cover in the region of 30 different conditions. Some of the most common conditions covered in trauma insurance policies include:

  • Heart conditions such as a heart attack or coronary bypass.
  • Some types of cancer.
  • Neurological conditions such as a stroke, Alzeimer’s disease and Multiple Sclerosis.
  • Organ disorders such as chronic kidney failure and major organ transplants.
  • Permanent conditions such as blindness, paralysis, loss of hearing, speech or limbs.
  • Intensive care treatment

Each insurer will have varying definitions for each condition and varying requirements regarding severity so it’s important to read the fine print of the PDS carefully.

What is not covered by Trauma Insurance?

Several exclusions are common with trauma insurance and keep in mind there are waiting periods and qualifying periods (often up to 3 months) that can also apply. Each provider will have slightly different details regarding exclusions and they should be outlined in the policy. Some standard exclusions include:

  • Death from suicide within a certain period of purchasing the policy.
  • An intentional self inflicted injury.
  • Any traumatic event or condition that is not outlined in their policy.

Is Trauma Insurance Tax Deductible in NZ?

The great news about trauma insurance, or any life insurance payout is tax-free in New Zealand as long as the owner of the policy is a person. Whatever trauma you experience, it will likely induce a monument of stress both physically and emotionally so it helps to know whatever lump sum you are paid out from a claim is solely yours and no tax payment is required.

There are many trauma insurance policies out there to consider with different coverage and benefits to you. Reach out to our experts at MyFuture today for your no obligation FREE discovery session to create a protection plan for you and your family.