Trauma insurance is an insurance product, like TPD, death, and income protection insurance. However, unlike TPD and income protection insurance policies, which pay out a benefit if you cease work due to illness or injury, you usually do not have to stop working to be entitled to a trauma insurance benefit.
Also, unlike TPD and income protection insurance, trauma insurance is not available through your super. It is usually purchased directly from an insurance company or through a broker. Some employers may also make it available as part of an employment package.
You learn more about the differences in these injury and illness insurance types, visit our blog, “The difference between trauma insurance and TPD insurance”.
What does trauma insurance cover?
Trauma insurance pays a lump sum benefit (usually a pre-arranged, set amount) if you are diagnosed with a number of different illnesses or injuries (or illness-released events eg, heart attack).
The list of illnesses that are covered by trauma insurance varies between policies and can include:
- Cancer (including Melanoma, Lymphoma, Prostate Cancer, Breast Cancer, Leukaemia)
- Heart attack;
- Multiple Sclerosis;
- Parkinson’s Disease;
- Brain injuries;
- Other conditions which cause you to be so disabled that you are unable to independently perform your activities of daily living;
As outlined above, trauma benefit payments are usually payable without any consideration of the impact of illness/injury on your work capacity. However, the illness or injury is usually defined in the policy and specific criteria must be met at the time of the diagnosis before a payment can be made.
We understand that the illnesses which most commonly cause people to claim on trauma insurance policies are cancer and heart attack.
Also, it is not always well understood that you can claim a trauma insurance benefit without being diagnosed with a listed illness or injury. Claims without the diagnosis of a listed illness or injury can sometimes be made if you become unable to complete your activities of daily living.
Cancer trauma insurance claims
To claim trauma insurance, it is not enough that you have a cancer diagnosis. You must have a cancer diagnosis which fulfills the specific criteria in your trauma insurance policy. The criteria usually depend on the specific cancer that you have been diagnosed with.
For each type of cancer, the specific location of the cancer is important when considering what features must be present to be entitled to a benefit. For example:
To claim trauma insurance for skin cancer, the policy may require that the cancer must be a melanoma and must present with a specific level of Breslow thickness and/or a particular Clarks level and be malignant. Malignant is often defined as severe and progressively worsening, categorised by the presence of uncontrolled growth.
Prostate cancer needs to present as malignant and a certain stage of TNM (Tumour, Nodes, Metastases) to be able to claim on a trauma insurance policy.
For leukaemia trauma insurance claims, the illness may need to be chronic with a particular RAI stage, malignancy and requiring specific treatments, like endoscopic treatments.
Trauma insurance claims for breast cancer may require the removal of breast tissue along with a categorisation which can include autonomous new cancer growth, as well as the invasion of new tissue or the removal of an entire breast.
Heart related trauma insurance claims
Heart attack is almost always covered in trauma insurance policies and is one of the most common reasons that people lodge claims.
However, whilst doctors consider that you have had a heart attack if an artery that sends blood and oxygen to the heart is blocked causing stress or damage to the heart, a trauma insurance policy usually has a different, more restricted, definition.
There have been a number of changes in the definition of heart attack over recent years in response to changing methods of treating heart attacks. This happened because some of these changes in treatment meant that some of the older definitions had become obsolete and were no longer achievable.
We saw this exposed as part of the Royal Commission in Banking and Finance. The Royal Commission showed that the level of Troponin markers (enzyme or protein markers that indicate that the heart is under stress) which had to be present under many insurance policies were unachievable (without death) and that some insurers knew this and did not make changes to their policies.
This revelation led to wholesale changes in the insurance world relating to heart attack definitions. Now, the definition is typically less likely focused on Troponin and more likely focuses on a combination of factors like:
- death of part of the heart muscle;
- abnormal Q-Waves;
- enzyme (including Troponin) markers;
- confirmed ECG changes.
If not all of the requirements to satisfy the heart attack definition are present but medical treatment is required, for example, an angiogram or other heart surgery, then you may still be entitled to a reduced payment of the trauma insurance benefit (as determined by the relevant insurance policy).
Get help from a trauma insurance lawyer
Also, as outlined above, there are a number of conditions which may be covered under a trauma insurance policy and the terms and conditions specific to each of those conditions vary from policy to policy. The policy wording can be complex to interpret.
If you have suffered from an illness which has required medical treatment and you are wondering whether that illness or injury may entitle you to claim under your trauma insurance policy, we recommend that you get in touch for some free advice.
Contacting Berrill & Watson
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📞 Anywhere else in Australia: 03 9448 8048
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