Do I need trauma cover?

Whether you need trauma cover or not depends on your circumstances. It’s about your ability to support yourself or your dependents if you experience a serious medical condition or illness.

Many New Zealand families experience the consequences of serious illness at some point in time. Think about your own family – do you know someone who’s experienced a heart attack, cancer, stroke or dementia? These are some of the most common conditions typically covered by trauma insurance.

It’s important to know each condition comes with a medical definition, that’s defined in the policy documents, from the insurer. A financial adviser will be able to help you understand the ins and out of trauma cover. We can help you find an adviser here.

What is trauma cover?

Trauma cover, also known as critical illness cover or serious illness cover, is a specific type of life insurance that pays out if you experience one of the health conditions listed in the policy. It’s important to understand exactly what a trauma cover policy includes, because there is a common misconception that trauma cover provides general protection for any traumatic experience.

Source: https://www.ifso.nz/media-releases/trauma-insurance-wont-cover-all-traumas

When a claim is accepted, trauma cover typically pays a lump sum. When you take out the cover, you’ll be asked to select an amount of cover that’s right for you. We recommend you work with a financial adviser to help develop a plan that’s right for you.

Ready to find out more? Get in touch.

Why get trauma cover insurance?

Let’s start here, do you have saving tucked away, to get you by, if a serious medical condition or illness came along? A survey by the Financial Services Council (FSC) of New Zealand in 2022 found that most employed New Zealanders have less than 6-months worth of expenses saved. The same FSC research showed that 40% of New Zealanders would be unable to access $5,000 (without going into debt), if something unexpected were to happen to them.

Source: https://blog.fsc.org.nz/2022-research-financial-resilience-index

A lump sum payment from a claim can help go towards medical bills, ongoing treatment costs and help to lighten the day-to-day financial load, enabling you to focus on getting better.

For all of us, as the years tick by, the risk of serious illness increases with age. For this reason alone, it could be a smart decision to consider developing a plan before a serious sickness or illness were to happen to you.

Source: https://www.sciencedirect.com/science/article/pii/S0960982212008159

What does trauma insurance cover?

Trauma insurance cover is designed to pay out a lump sum if you suffer from a condition covered in the insurance policy, like a heart attack, cancer, stroke, angioplasty and more. If you take out Fidelity Life Trauma cover, you’re covered for 40+ conditions as defined in the policy document. Depending on the condition you’ll receive payment of the full amount or a partial payment.

You can see the complete list here.

Do I get anything else included?

Depending on the life insurance company you choose, you might discover there are other things included in your policy. With a Fidelity Life Trauma cover policy, you also get these:

1. Protect your children – For no extra cost your children (ages 2-20) would also be covered. Should they suffer one of the eligible trauma conditions a payment for a percentage of your cover would be paid. This is an additional payment that does not reduce the amount of the parent’s cover.

2. Increase your cover without additional medical information – There are lots of milestones in life that can prompt you to increase your cover. You may have got married, had a child, taken out or increased a mortgage. As life changes, so can your cover. At times like these, you might be able to increase your cover without providing any additional medical information.

3. Relocation benefit – If you have been living overseas for more than 3-months and have a trauma claim accepted, we will pay an economy airfare for you and a support person, for up to $10,000 to be flown back to New Zealand.

4. Financial planning benefit – If you receive a large lump sum payment it can be overwhelming to plan how to use these funds. In situations like this, working with a financial advice provider or lawyer can be invaluable. If you were to receive a benefit payment from us, we will reimburse the actual cost up to $2,500, for a fully documented financial plan prepared by a financial advice provider or legal advice received from a lawyer who can help plan your financial future.

5. Access to Cancer companion – providing additional support for Fidelity Life Trauma cover customers with a cancer diagnosis. Learn more here.

How do you get trauma cover?

To get trauma cover, you first need to apply. Your application will include providing personal information about your health and medical history. You’ll need to meet the age requirements too. For Fidelity Life Trauma cover, you can apply between the ages of 16 and 64. This trauma cover is available as a stand-alone policy or as an add-on to a Life cover policy.

To find out more about trauma cover, talk to an expert.

Before you decide to get trauma cover, we recommend you talk to a financial adviser. You can ask questions and find out more about how trauma cover works and the level of cover you might need.

Find an adviser.

DISCLAIMER: The information contained in this article is a summary of the key points of the insurance cover mentioned and is general in nature. This article does not constitute a financial advice service. All covers are subject to the definitions, standard exclusions/limitations, terms and conditions contained in the full policy documentation which is available from Fidelity Life or your financial adviser who holds a Distribution Agreement with Fidelity Life. All applications for cover are subject to underwriting criteria.