How much trauma insurance cover should I have?

The right Trauma sum insured depends on your specific debts, dependants, and likely recovery costs. There is no statutory formula; common considerations include mortgage balance, medical and treatment gaps, household income during recovery, and rehabilitation or retraining costs. The brokerage provides general advice only and the figures below are illustrative.

Unlike Life cover (which addresses long-term household income replacement) and Income Protection (which covers monthly cash flow), Trauma cover is most often used as a recovery buffer in the year or two after diagnosis. Typical use cases include paying down or buffering the mortgage, funding treatment not covered by Medicare or private health, modifying the home, and replacing income for a spouse who steps out of work to care for the insured.

Common factors to think about

1. Outstanding mortgage: a Trauma payout that clears the mortgage removes the largest household pressure point during recovery.
2. Other debts: vehicle loans, personal loans, credit cards, and business loans.
3. Medical and treatment gaps: costs not covered by Medicare or private health (private oncology treatment, specialist consultations, home nursing, allied health, medications not on PBS).
4. Lost household income during recovery: a 12 to 24-month buffer for a spouse who steps out of work, or for the insured during the survival period and treatment phase.
5. Home modifications: ramps, bathroom modifications, accessible kitchen, vehicle modifications.
6. Career retraining or business adjustment: course costs, equipment, business consulting if returning to a different role.
7. Children's education: school fees, university costs.
8. Less existing resources: liquid savings, emergency funds, any spouse income.

Panel sum insured caps

The panel imposes maximum Trauma sums insured. ClearView is the panel outlier with a $3 million aggregate cap across all insurers (anti-stacking on Trauma cover, unique to ClearView).

| Insurer | Maximum Trauma sum insured | |---|---| | AIA | $2,000,000 (Crisis Recovery cap; $50,000 minimum) | | Zurich | $2,000,000 | | TAL | $2,000,000 | | OnePath | $2,000,000 | | ClearView | $2,000,000 Standard; $3,000,000 Severe Events; $3,000,000 aggregate across all insurers | | NEOS | $1,000,000 at commencement; $2,000,000 over the life of the plan | | Encompass | Verify against current PDS (adviser guide indicates $750,000 to $1,000,000 range) | | Acenda | $2,000,000 (Plus); $500,000 outside super (Standard) | | Futura | $2,000,000 |

Sources:

• AIA Priority Protection PDS (Version 32, 9 November 2025).
• Zurich Wealth Protection PDS (1 November 2025), adviser guide trauma section.
• TAL Accelerated Protection PDS (12 December 2024), Ready Reckoner.
• OnePath OneCare PDS (1 October 2025), adviser guide trauma section.
• ClearView ClearChoice PDS (13 May 2024, update 5 June 2025).
• NEOS Protection PDS (6 December 2024), adviser guide trauma section.
• Encompass Protection PDS (26 September 2025).
• Acenda Insurance PDS (27 September 2025), adviser guide trauma section.
• Futura Protection PDS (1 October 2025), adviser guide trauma section.

When to review your cover

Life events that typically prompt a Trauma cover review:

• Mortgage refinance or property purchase
• Birth or adoption of a child
• Career change with material income change
• Family medical history change (parent or sibling diagnosed with a major condition)
• Children becoming financially independent
• Final mortgage payoff
• Approaching retirement

Several panel insurers offer a Future Insurability or Future Increase Benefit on Trauma cover, letting you raise the sum insured at specified life events without further medical evidence (subject to per-insurer limits and age caps, typically up to age 55 or 60).

Trauma cover is generally not held inside super

Under SIS Reg 4.07D (effective 1 July 2014), new Trauma policies cannot be held inside super. This means premiums are paid from after-tax personal cash flow rather than from super contributions. When sizing your sum insured, factor in that you pay premiums outside super (no concessional contribution offset) but receive a tax-free lump sum on claim (under ITAA 1997 s118-37).

How Trauma sizing relates to Life and TPD sizing

• Life cover sum insured typically targets long-term income replacement for dependants plus debt payoff plus education costs.
• TPD sum insured typically targets permanent disability lump sum (often similar order of magnitude to Life cover).
• Trauma sum insured typically targets a 1 to 3-year recovery buffer plus mortgage paydown. It is commonly smaller than Life or TPD because the use case is short to medium-term cash flow during recovery rather than lifetime income replacement.

For a household with $800,000 mortgage and $100,000 in other debt, a Trauma sum insured between $300,000 and $500,000 is often a starting point for discussion; the actual figure depends on existing savings, spouse income, and specific health considerations. This is illustrative; the brokerage provides general advice only.

Regulator anchor

The Insurance Contracts Act 1984 and Life Insurance Act 1995 govern the contract framework. ASIC's MoneySmart at moneysmart.gov.au has consumer-level guidance on Trauma cover. Your specific circumstances may warrant personal advice from a licensed financial adviser who can prepare a Statement of Advice. The information above is illustrative and based on the panel PDS framework.