As we get older, sadly, the chances increase of us having a health issue.
Are you one of the 1 in 2 men who may suffer from cancer in their lifetime , or one of the 1.4 million Australians who suffer from heart disease ? There is a very real chance that at some point in your life you will be touched by a medical condition or health issue. It can be a stressful time for everyone – both financially and emotionally.
It’s at times like this that we turn to our family and friends for support AND then consider what insurances we have in place to help us through these life situations. Unfortunately, in many cases, clients I speak with do not have the right insurance.
Trauma insurance is an insurance policy that you can take out, so in the unfortunate event that you are diagnosed with a life-changing illness* or injury, you may be able to claim for a set amount of money. You can then use this money to make the lifestyle changes that you need in order to achieve financial independence or to make things easier for you.
Generally, policies cover you for a heart attack, stroke, cancer, or another serious condition; in fact there around 30 to 40 conditions are covered.
Why Do We Need Trauma Insurance?
When working with my clients I ask that they consider trauma insurance so that should serious illness or injury occur they could then be entitled to receive a tax-free lump sum, which could be used for medical expenses, to modify your house or car, to pay off debts and secure financial independence, or pretty much anything else that you need.
Does Everyone Need It?
Just think how invaluable a lump sum would be if you found yourself having to cope with personal illness. It is about preparing for life’s unexpected eventualities. Trauma insurance is something you should consider to ensure you can continue to meet your financial commitments.
How Much Does It Cost?
Your monthly repayments will depend on the amount of cover that you need and your budget – and the amount of cover you need depends on your personal circumstances. As a rule, consider a starting point of $200,000 worth of cover; the amount will very much depend on your financial circumstances. Discuss your situation with a financial adviser so they can help calculator what level of cover you need.
Things to Remember When Discussing Trauma Insurance with Your Financial Adviser
It is important that you provide your Financial Adviser with as much personal and family history as possible. Similarly, you must also be completely honest about your debts and financial commitments so that you are sufficiently covered and there are no shortfalls.
Examples of Trauma Insurance Helping Clients
A client of mine was diagnosed with Crohn’s disease. Whilst not immediately life threatening, Crohn’s can be serious and leaving you feel unwell for the rest of your life. In this instance the insurer paid a percentage of the total sum insured, which in this case was $30,000. This payment assisted my client to make the necessary changes to their lifestyle to assist in managing the ongoing condition. One of my dear clients had a stroke at just 48. Because we had taken the time to work together to ensure her policy was put in place correctly from day one, the full amount for which she was insured was paid. This assisted with her rehab and also covered her for being unable to work.
There are many stories to tell but as is so often the case we never really understand the value of something until we need it. If you would like to know more and discuss trauma insurance, please do get in touch with us. You can call us on 1300 925 840 to speak with one of our Financial Advisers.
Disclosure: All Financial Services (NSW) Pty Ltd, ABN: 56 055 133 018, is a Corporate Authorised Representative (No.280477) of Aon Hewitt Financial Advice, ABN 13 091 225 642 (AFSL No. 239183) of Level 33, 201 Kent Street, Sydney NSW 2000. This information may be regarded as general advice. That is, your personal objectives, needs or financial situations were not taken into account when preparing this information. Accordingly, you should consider the appropriateness of any general advice we have given you, having regard to your own objectives, financial situation and needs before acting on it. Where the information relates to a particular financial product, you should obtain and consider the relevant product disclosure statement before making any decision to purchase that financial product.
*Subject to insurer’s policy wording – refer to the PDS.
 Australian Institute of Health and Welfare & Australasian Association of Cancer Registries 2012. Cancer in Australia: an overview, 2012. Cancer series no. 74. Cat. no. CAN 70. Canberra: AIHW.
 National Heart Foundation of Australia, 2007 (Report by Vos T and Begg S, Centre for Burden of Disease and Cost effectiveness, University of Queensland School of Population Health). The burden of cardiovascular disease in Australia for the year 2003.