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The Enduring Relevance of Trauma Insurance

The Enduring Relevance of Trauma Insurance

Trauma insurance provides much-needed financial protection against serious medical conditions. Jeff Scott traces the origins of trauma cover and highlights the value it provides cancer sufferers and their families.

Trauma insurance was first introduced in South Africa in 1983 by Dr Marius Barnard to give people much-needed financial protection against serious medical conditions like cancer, heart attack, stroke or an accident.

In the 34 years since, trauma insurance remains just as important as ever.

Looking specifically at cancer, it’s a disease that does not discriminate. It can strike anyone, at any time.

Anyone who has battled cancer or watched a loved one suffer from the disease knows how destressing it is. From diagnosis to treatment to remission (for those who live to be cancer-free), the process is often long and painful which is why appropriate trauma cover is so important.

Encouragingly, the overall cancer mortality rate continues to fall due to early detection and more effective treatments but this means more people are living with cancer.

There are numerous forms of cancer treatments including surgery, chemotherapy, radiotherapy, hormone therapy, immunotherapy and targeted therapy. These treatments can be used in isolation or in conjunction with one another to try and reduce, minimise or eliminate cancer.

In the past 25 years, the five-year cancer survival rate has improved significantly to 68 per cent for men and 69 per cent for women.

However, the survival rate varies depending on the form of cancer.

For example, men have a 95 per cent survival rate for prostate cancer and women have a 90 per cent survival rate for breast cancer but the survival rate for lung cancer (14 per cent for men and 19 per cent for women) and pancreatic cancer (8 per cent for men and women) is dramatically lower.

It’s estimated that the average personal, financial cost of cancer is approximately $114,500 although the financial burden of brain cancer and leukaemia is much greater; $325,000 and $258,000 respectively. On the other hand, the average financial cost of prostate and breast cancer is around $64,000 while melanoma costs around $32,100.

Financial costs, which include treatment and medicines plus both loss of personal income and loss of income for spouses/carers, are a crude way to look at the impact of cancer which also has an enormous psychological and social impact but as Dr Marius Barnard famously stated in 1983: “A medical doctor can a repair a man physically, but only insurers can repair a patient’s finances”.

Fortunately, trauma insurance policies issued in Australia today have a much wider application than the original policies issued in the early 1980s. The first policies were designed as a form of health insurance to cover medical bills and doctors’ fees but individuals today enjoy greater benefits and choice.

Lump sum payments can be used to pay for non-traditional treatments, modifications to their residence or to compensate a spouse for taking time off work to care for a sick partner.

ClearView LifeSolutions continuously monitors and improves its cancer definitions and exceeds the Financial Services Council’s standards for Minimum Medical Definitions.

The statistics

  • Around 134,000 Australians will be diagnosed with cancer (72,000 men and 62,000 women) in 2017 and around 48,000 people will die from cancer.
  • From birth to age 24, the top 3 diagnosed cancers are leukaemia, lymphoma, and brain cancer. In this age group, over 1,600 new sufferers are diagnosed each year.
  • The top 3 diagnosed cancers for people between the ages of 25-49 years are breast cancer, melanoma and colorectal cancer. In this age group, there 16,000 new sufferers are diagnosed each year.
  • The top 3 diagnosed cancers for people between the ages of 50-64 are breast cancer, prostate cancer and colorectal cancer. In this age group, there are about 38,000 new sufferers are diagnosed each year.

– Jeff Scott is head of product at ClearView Wealth.

 References

“Cancer in Australia 2017 – In Brief”, Cancer series number 102, Australian Institute of Health and Welfare, Canberra, Cat. no. CAN 101.

“Cancer Council – A guide for people with cancer, their family and friends – Treatment” – Cancer Council of Australia, August 2016.

Cost of Cancer in NSW – A report by Access Economics Pty Limited for The Cancer Council NSW, April 2007.

 

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