How Much Trauma Insurance Do You Need?
When deciding how much trauma insurance to acquire, you should take into consideration your financial commitments such as your mortgage or rent, regular fees, and debt repayments. Apart from paying off the remainder of any debts, you'll want to think about immediate costs in the event of a medical emergency, such as:
- The cost of immediate care in hospital
- The ongoing cost of any therapy,
- Special transport costs, and
- Adjustments to housing and lifestyle changes.
You should also consider other insurances that you may be able to claim on in the event of a trauma event, particularly income protection insurance. Trauma insurance does have the highest premiums on a per dollar of cover basis because of the high rate of claims. Don't let that put you off getting cover; if you have a small budget, you can always just get a smaller amount of cover. It's not uncommon for people to take out $100,000-$250,000 trauma insurance: some cover is better than no cover at all.
Trauma Insurance Case Study
- Situation: 50 year-old couple with two adult children and a $250,000 mortgage with the father earning $45,000 a year and the mother $50,000. The mother is unfortunately diagnosed with breast cancer and is unable to work for a period of 3 months (making a full recovery).
- Trauma Insurance pays her $150,000, allowing the family to pay off meet immediate medical expenses and living costs, permits the husband to take extended leave from work to care for his wife.