How to Structure Life Insurance and Trauma Insurance

SP Insurance 

Standalone

  • Standalone Trauma insurance can be purchased alone. You can apply for coverage amount between NZ$10,000 and NZ$2 million.
  • If you file a claim and meet conditions of the claim, the insurance company will pay you all the amount of coverage in lump sum.
  • The claim for this insurance does not affect your other insurance.

For example: If you purchase $400,000 of Standalone Trauma Cover and $500,000 of Life Cover, the claim of $400,000 Trauma will not affect the sum insured of Life insurance at all.

Accelerated

  • Trauma insurance is required to be purchased with Life insurance.
  • The product is the same as Standalone Trauma's, but the premiums and underwriting requirements are slightly different, and there will also be an impact on claims.
  • If you file a claim and meet the conditions of the claim, the insurance company will pay you all the amount of coverage in lump sum. The claim amount will reduce the amount of coverage from your life insurance.

For example: If you purchase $400,000 of Accelerated Trauma Cover and $500,000 of Life Cover, the claim of $400,000 Trauma will affect the $500,000 Life coverage. The life insurance coverage will be reduced to $100,000.

Which one should you pick, Standalone or Accelerated?

Standalone

  • Standalone trauma provides more comprehensive protection and more certainty.
  • In addition, some insurance company's generous terms apply to Standalone trauma only.

Accelerated

  • Accelerated trauma’s premium is lower than Standalone
  • Most insurance companies offer "multi-product discounts", and if you purchase a certain amount of life and trauma cover at the same time, you can enjoy a certain discount. For people with limited budgets, accelerated trauma is a good choice.

Everyone or every family will have different financial status and lifestyle, so there is no best option, pick the one that suits you better.



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