Trauma Insurance

 Trauma Insurance (sometimes referred to as CI or Critical Illness Insurance) provides a lump sum payment in the event that the insured is diagnosed with a particular medical condition that is defined in the policy.  A trauma cover generally expires at Age 70.

Trauma Insurance is an important consideration for anyone who doesn't have a significant amount of extra money at call if a traumatic health condition were to occur.

The purpose of trauma insurance is to ease the financial burden associated with recovering from insured trauma events e.g. cancer, stroke and heart attack etc. and dealing with the financial difficulties that various trauma conditions can cause – being off work for a considerable amount of time/ loss of income during that period.

You could use the money to pay for specialists or medical expenses, pay for lifestyle changes and rehabilitation. It would allow you and your partner if necessary, to take some time off work so as to assist in recovery.

• Tax treatment
  Trauma Insurance premiums are generally not tax deductible but the lump sum benefit payment received is tax-free, if paid to insured.
• List of common Trauma events that can be covered
  
  

  Alzheimer's Disease	Aplastic Anaemia	Blindness
  Burns - Server/Major	Cancer	Cardiomyopathy
  Coma	Coronary Artery Angioplasty	Coronary Bypass Surgery
  Deafness	Dementia	Diplegia
  Encephalitis	Heart Attack	Heart Valve Surgery
  Lung Failure- Chronic	Kidney Failure - Chronic	Liver Disease - Chronic
  Lung Disease - Chronic	Loss of Independence Existence	Loss of Limbs or Eye Sight
  Loss of Speech	Major Head Trauma	Major Organ Transplant
  Motor Neuron Disease	Multiple Sclerosis	Parkinson's Disease
  Pulmonary Hypertension	Stroke	Muscular Dystrophy
  Paraplegia	Quadriplegia	Hemiplegia

  
  Each insurance company varies with what illnesses they will and won't cover. Within those illnesses there are guidelines to say whether they partially or fully cover the conditions within the illness. 
  
  For the most part there is no waiting period on trauma insurance policies. If, within the first 3 months of holding a trauma insurance policy however, you fall ill with cancer, a heart condition or a stroke, you will not be able to claim immediately. This is due to insurance company's reasoning that if you fell ill with one of these conditions, you would most likely have suffered some symptoms leading up to taking out the insurance. Once the 3 month period has passed however, you are able to claim on any of the illnesses included within your trauma policy, including the 3 excluded in the first 3 months.

• Trauma Insurance Options:
  You can either have Trauma Linked to your Life Cover or have it as Stand-Alone. Linked Trauma is cheaper as compared to Stand-Alone but it also means that when/if your Trauma claim is paid out, your Life Cover will reduce by the Trauma amount. You do have other options like Life Buyback or Trauma Reinstatement which are available at extra cost. If you claim on stand alone Trauma, your Life Cover is not affected by the payout.
• How does Trauma Insurance work?
  Carol, a 35 year old who worked as an office administrator, began suffering severe abdominal pain. Her GP recommended some tests and the results showed cancer in her left ovary which meant that Carol had to stop work immediately and begin treatment. Since the treatment was long term, her sick/annual leave would not be sufficient to cover her financially in the coming months. 
  
  Luckily, Carol had gone in for a Trauma cover of $200,000 some years earlier, which was paid as a lump sum payment after her diagnosis. Using this money Carol was able to cover all her medical expenses, pay off part of her mortgage and still have more than enough to take a 12 months off work as she concentrated on her treatment and recovery.