Understanding Trauma Cover

The risks

  • In 2010, an estimated 114,000 new cases of cancer were diagnosed in Australia [1]
  • More than 60% of cancer patients survive more than five years after diagnosis [2]
  • Two out of every people that suffer a first time stroke will be alive one year later [3]
  • About 88% of stroke survivors live at home. Most of them live with a disability [4]
  • Stroke costs Australians an estimated $2.14 billion every year [5] 

The reality

Australians are suffering an increasing incidence of cancer along with high levels of heart disease and stroke.

Whilst advances in medical science mean we now have a greater chance of surviving such traumatic events, treatment can be drawn out and expensive – whilst forcing patients to take months, or years off work

Some misconceptions 

“My private health insurance will cover me”

The average household cost of cancer is $47,000[6]. While health insurance helps with medical treatments and hospital expenses, it does not cover some specialist therapies, ongoing treatment needs or the immediate care that is often required.

“I have Total and Permanent Disability Cover”

Nowadays, serious illness doesn’t necessarily result in a total and permanent disability. Advancements in medical science mean that it is now possible for patients to recover their original lifestyles. Even so, the financial costs can still be significant – which is why Trauma cover is vital.

What is Trauma Cover? 

Trauma Cover pays an agreed lump sum benefit in the event of a listed serious illness. This money can help you survive financially while you focus on recovering and getting back to your everyday life.

What do the payments protect? 

A lump sum could help you stay on top of expense such as:

  • Medical expenses and treatment costs
  • Debt repayment
  • Additional care and rehabilitation
  • Lifestyle modifications

Tom’s Story

Tom is a successful lawyer and is married.  He has worked hard over the past ten years to accumulate valuable assets.  To support his desired lifestyle, Tom decided on a $300,000 Trauma policy but decided against indexation.

Unfortunately, last year Tom was diagnosed with prostate cancer and was unable to work for six months while he underwent treatment and recovered from the illness.  This meant Tom had to rely on his wife’s income.

Tom was paid a Trauma benefit of $300,000 from his policy, which assisted with his recover.  Tom continued to pay his annual policy fee and twelve months after the initial payment of Trauma benefit, Tom bought back his $300,000 Trauma policy at standard premium rates.

Unfortunately, six months later Tom had a serious accident at work and suffered a major head trauma.  Tom was relieved that, as a result of the Trauma policy, he was awarded another Trauma benefit of $300,000.  Provided by CommInsure Claims.

How can a financial adviser help? 

No one plans to get sick, injured or to die prematurely, but you can take the opportunity right now to explore your options and make a conscious choice about your future, rather than leaving it to chance.

Putting your plan together is best accomplished with the help of a Risk Insurance Specialist. It may be the most significant step toward financial freedom you ever take.


[1] Cancer Council Australia (2011) Facts and Figures http://www.cancer.org.au/Newsmedia/factsfigures.htm viewed 1 May 2012

[2] Cancer Council Australia (2011) Facts and Figures http://www.cancer.org.au/Newsmedia/factsfigures.htm viewed 1 May 2012

[3] Cancer Council Australia (2011) Facts and Figures http://www.cancer.org.au/Newsmedia/factsfigures.htm viewed 1 May 2012

[4] National Stroke Foundation (2012) Facts, Figures and Statistics http://www.strokefoundation.com.au/facts-figures-and-stats viewed 1 May 2012

[5] National Stroke Foundation (2012) Facts, Figures and Statistics http://www.strokefoundation.com.au/facts-figures-and-stats viewed 1 May 2012

[6] Cost of Cancer in NSW (April 2007) A report by Access Economics Pty Limited for The Cancer Council NSW

Disclaimer

The information contained on this website is for general information only and should not be relied upon unless you first discuss your circumstances with a Licenced Financial Planner.

The Authorised Representative of Alea Insurance Pty Ltd ACN 107 647 192 is Steve Wilson (AFSL No: 331367) who is licensed by ClearView Financial Advice Pty Ltd ACN 133 593 012.