Life is so uncertain; we never know what may happen tomorrow to ourselves, or our loved ones. Every year thousands of people deal with unexpected injuries or sudden severe illness, which can be challenging for them and their families, both emotionally and financially.
According to the Australian Institute of Health and Welfare, around 160,000 Australians die each year, and 1 out of 4 people die before the age of 75. The most common cause of death is coronary heart disease, followed by cerebrovascular diseases such as strokes and lung cancer.
Even in 2018, Cancer Council Australia stated that by the end of 2020, 150,000 people will be diagnosed with cancer every year.
It’s easy to think that events like this won’t happen to you, but just because it might not doesn’t mean we shouldn’t be prepared or uninsured when it comes to such uncertainties. Taking care of our loved ones is our responsibility, but if we aren’t around or suffer from a major illness, who will take care of your family?
There are various types of insurance available to you, including life insurance, TPD, income protection and trauma insurance. However, you might be asking do I need all these types of insurance. There is not a straightforward answer, it comes down to personal circumstances & choices. While it would be great to have them all, you might not be able to. Every insurance has its purpose that will protect you from various situations.
So, let’s talk about two important types of insurance: life insurance and trauma insurance. Many people think that trauma insurance is not important if you already have life insurance. While they both have their pros and cons, do you need to have both life and trauma insurance? Well, let’s find out.
Life insurance is one of the most common and popular insurance policies to have. Life insurance is the best way to insure our family’s financial security, for a certain amount. Life insurance pays out a lump sum amount, if you happen to pass away from any cause (some exclusions will apply of course), which can help to ease the financial burden on your loved ones. The amount can be used for a funeral, paying bills, a loan or any expense.
If you have a dependent spouse, child or parent, the importance of life insurance for you is even greater. You can also decide on the beneficiary who will receive the amount from the insurance if you are to pass away, hopefully reducing the financial pressures.
Trauma insurance, also known as critical illness insurance, provides a lump sum amount if you suffer a “critical condition” as defined by the insurance cover. It is designed to help you financially from the sudden impact of a trauma, such as a stroke, cancer, heart attack, or other life-threatening conditions.
A major benefit of Trauma cover is that the lump sum is payable upon diagnosis. It makes for a simple claims process and you can often receive your benefit payment before your treatment has either begun or finished.
If you are diagnosed with a critical illness such as cancer, the cost of treatment can be financially challenging for your family. In such a situation, trauma insurance provides essential financial help for your treatment where health insurance cover isn’t enough to cover everything.
So overall, we can determine that is important for you to have both life and trauma insurance. They both help with different aspects of your financial security and that of your loved ones. As we always advise, it is best to talk to an expert about what you can do to protect your family financially.