Although you cannot prevent many traumatic situations from occurring, you can take out insurance against some forms of trauma. This can be arranged when the experience comes under the definition of trauma laid down by life insurance companies in the terms and conditions of their trauma insurance policies.

People may well ask, ‘What is trauma insurance?’ Trauma cover will compensate you financially with the payment of a lump sum amount of money should you suffer what the life insurance company defines as being a traumatic occurrence. There are many events that you can be covered against and this varies between companies but all companies agree on cover for incidents such as cancer, heart attack and stroke, as the three basic illnesses they compensate for.

Trauma Insurance is Living Insurance

Some people call trauma insurance critical illness insurance, others call it sickness and accident insurance. It has even been called living insurance because you have to remain alive to obtain a payout where term life insurance only pays out on death. The benefits of trauma insurance will be paid out when you suffer from one of the life insurance company’s listed traumatic events, as stated in the policy, regardless of whether you can continue working or not. You are also able to purchase trauma insurance as a stand alone cover or have it made in addition to your life insurance policy.

Trauma insurance definition events can differ from company to company but most will cover you for the following events:

• Alzheimer’s disease
• Major burns
• Blindness
• Coma
• Deafness
• Dementia
• Coronary by pass surgery
• Encephalitis
• Chronic liver disease
• Major organ transplant
• Paraplegia
• Quadriplegia
• Heart attack
• Occupational acquired HIV
• Chronic lung disease
• Stroke
• Motor neurone disease
• Parkinson’s disease
• Heart valve surgery
• Chronic kidney failure
• Loss of limbs or eye
• Major head trauma
• Multiple sclerosis

If you want to have yourself covered for an event not listed in the insurance company’s list you can ask for it to be included but it will mean you having to pay a higher premium.

Trauma Insurance Relieves Financial Stress

To receive the benefits from a trauma insurance cover you must survive at least 14 days after being diagnosed, or having the incident before you are allowed to put in a claim and have it successfully paid. Insured people have, as a result, been able to put the financial stress that would otherwise take place at such a time, out of their minds, knowing that their family’s money matters are taken care of, so that your health, at that moment, is their top priority. Your trauma insurance cover could be utilised to pay for such things as the following:

• Extra money to cover any extraneous hospital or medical bills.
• Pay for someone to take your place if you are the proprietor of your own small business.
• Pay out any credit card or other debts to give you more cash flow.
• Pay off your mortgage so that you know that no matter what happens in the future to yourself your family will always have a roof over their heads.

Although people are living longer due to living healthier lifestyles and the advancement of life prolonging drugs, we are still experiencing an increase in the percentage of the population contracting some form of cancer, much the same can be said of heart disease and stroke. It is therefore becoming even more likely that we will suffer a traumatic event at some time in our lives.

This leads us to the likelihood that although we may medically recover from a traumatic event, the chances of recovery from the financial effect of such an experience on ourselves and our family, is not as certain, especially if you are not sufficiently insured against such a disaster happening. The chances of falling into serious debt is obvious if you are self employed and can not earn whilst you are ill, but your employer may not be able to keep your job open for you either, if you are unable to work over a sustained period. It is cases like these that the importance of having trauma insurance can not be over empathised.

Although the true trauma insurance definition is interpreted differently by life insurance companies for various events that may affect you on some occasions, it can mainly be used to describe an incident that is emotionally distressing and painful. An event of such proportion that it prevents you from being able to cope with your day to day life in an effective manner. It has been said that trauma is an event outside of a person’s control. This can be said to be true in one sense but it can also be ruled out in another, because you will always have the opportunity to insure yourself against such a happening, putting you back in control. This means that at least your financial affairs won’t be effected and you will be able to cope with day to day matters that much easier.