The Difference Between Trauma Cover and Total Disability Insurance (TPD)
Many Australians carry both trauma cover and total disability insurance (TPD). Here’s why.
Although trauma cover and total disability insurance (TPD) are similar, they are designed to produce two different outcomes. That makes it important to understand what both coverages do and what they don’t do.
Trauma Insurance: the Basics
Trauma insurance is taken out for specific illnesses. It pays out a lump sum if you are diagnosed with that illness. The lump sum is designed to help you take care of your financial responsibilities while you recover: both your standing expenses and new expenses such as rehabilitation or carers. Ideally, you are able to fully recover and get back to living your life with no severe financial consequences.
Trauma insurance covers such illnesses as cancer, heart attack and coronary bypass surgery. The illnesses are very specific and are defined within your insurance policy so that you know exactly what occurrences will result in benefits and what ones won’t.