What Is Trauma Insurance? (Critical Illness Cover NZ)
Trauma insurance pays a lump sum if you’re diagnosed with a serious illness like cancer, a heart attack or a stroke — money you can use however you need while you recover.
How it works
On diagnosis of a covered condition that meets the policy definition, the insurer pays an agreed lump sum directly to you. There are no restrictions on how you spend it — treatment not funded publicly, mortgage payments, time off work, or modifying your home.
It pays out while you’re still alive, which is what sets it apart from life insurance.
What it usually covers
Cancer, heart attack and stroke are the most commonly claimed conditions, but most policies cover a longer list. The exact conditions and how each is defined vary between insurers, so two policies at a similar price can offer quite different protection.
Trauma vs life vs health insurance
Life insurance pays your family when you die. Health insurance pays for private medical treatment. Trauma insurance puts a cash lump sum in your hands on diagnosis — useful for the costs and income loss that treatment alone doesn’t cover. Many people hold a combination.