29 Nov Why do I need Trauma cover when I have Medicare/private health?
We often receive questions about why people need Trauma cover if they are covered under Medicare and/or Private Health Cover. It’s a great question as there is a lack of understanding around Trauma cover in Australia; only about 8% of Australians have Trauma cover.
Trauma VS health insurance: The breakdown
A 2013 survey by TAL has found that as many as 17% of Australians believed that health insurance provides the same protection as life insurance, thus there is no need for the main income earner to be insured. However, it is important to understand that both trauma cover and health insurance serve two very different purposes, and having health cover alone is not sufficient to protect you against serious illness or injury.
Trauma cover – the nitty gritty
The ethos behind Trauma cover is that you’ve been diagnosed with something bad like cancer. It’s scary and it’s bad, but it’s not necessarily a death sentence so take the claim money and use it to recover! We want you to fight this illness and get better and not have to worry about your financial position in the process.
- Trauma cover will pay out a lump sum to create a cash asset in the event you are diagnosed with one of the conditions specifically listed on the policy.
- There are usually 50-60 conditions listed, the ‘big 3’ being diagnosis of cancer, heart attack/disease and stroke but it also covers health events such as multiple sclerosis, serious burns, blindness, kidney failure, rheumatoid arthritis and more.
Trauma insurance serves two main purposes:
- Use the money to focus on your recovery and,
- ensuring that a good quality of life can generally be maintained whilst you’re recovering because you don’t have to worry about your existing and potentially new financial commitments
What is Medicare?
Medicare is Australia’s public healthcare system funded by the Government with the aim to provide affordable medical care, and works as a form of universal health insurance for all Australian citizens and permanent residents. With Medicare, residents have access to subsidised treatment from medical practitioners and allied health professionals, free treatment in public hospitals and prescription medicines at reduced prices.
What is Private Health Cover?
While Australia’s Medicare is considered to be one of the world’s best public health system, it does not cover medical costs for more specialised care and services at private hospitals. Some treatments and surgeries are accessible by patients at a public hospital for free, but there is usually a long waiting list, which is why private health cover is encouraged for a much quicker admission for treatment.
Under this insurance you most likely will be able to choose your own doctor, surgeon and hospital, and you likely won’t have to wait long to be treated. You can also access specialist treatments like physio which may not be covered by Medicare.
Why Trauma insurance is not the same as health insurance
Trauma insurance works very differently, with the key difference being that a lump sum payment is made directly to you on confirmation of the diagnosis of one of the listed medical conditions. You can be covered for up to $2,000,000 lump sum payment that is paid upon diagnosis and is not dependent on your recovery (although that is the ideal outcome!).
The most important part in all this when we talk about Trauma cover allowing you to focus on your recovery and ensure a good quality of life is that the lump sum payment can be used at your discretion. You could use your payment to:
- cover any out of pocket medical costs such as rehab, therapy, nursing care, equipment
- mortgage or rent payments
- ongoing household bills
- education expenses
- other ongoing day to day living expenses.
- You can even use it to modify your home if required or to take your family away for a much-needed break.
How do I get Trauma cover?
Anyone can get Trauma cover, even children! Want more info on Trauma cover for children and why it’s relevant to your family protection plan? Click here!
A common complaint we often hear is that there is no sickness/accident option for people who perform household duties on a full-time basis. That’s where Trauma cover is perfect and it’s definitely something we recommend for people in this position because whilst they may not get paid for what they do, losing the abilities of a stay-at-home parent to an illness or injury can have devastating effects both emotionally and financially.