Life Insurance Types
There are many different life insurance types other than that which simply pays out when you die.
In addition to straight life insurance there are other types of cover that can protect you and your family whilst you are still living. Whilst these other covers are strictly known as life insurance, they all form part of the life insurance family.
TPD Insurance
Total and Permanent Disability (TPD) is one of the life insurance types most commonly bundled with a traditional life insurance policy.
A TPD insurance policy is designed to pay you a lump sum in the event that you become totally and permanently disabled due to an accident or illness that leaves you unlikely to ever return to full time work.
The proceeds of a TPD insurance policy are generally used in a similar way to life insurance proceeds, which includes the clearing of debts and mortgages and providing a financial buffer for the family. Unlike traditional life insurance, the funds can also be used towards medical costs and rehabilitation.
Trauma Insurance
Another of the common life insurance types is trauma insurance. Trauma insurance pays you a lump sum in the event that you are diagnosed with a critical illness.
Common illnesses triggering a claim include cancer, heart attack and stroke, but there are dozens of other illnesses that will be covered by trauma insurance.
Trauma insurance proceeds are commonly used to cover medical expenses and lost income, as well as providing a financial buffer to reduce stress levels at a time when you and your family should be concentrating on your recovery rather than worrying about financial matters.
Income Protection Insurance
The last of the major life insurance types is income protection, which is designed to cover your income in the event that you unable to work for a period of time due to illness or injury.
Unlike other life insurance types, income protection does not pay out a lump sum. Instead, the policy will pay you a monthly benefit until you are able to return to work or until the benefit period is exhausted, whichever occurs sooner.
Other Life Insurance Types
There are a number of other life insurance types designed for the business world. One of these is key person insurance. This type of cover is designed to protect businesses and their shareholders from financial loss if a key person in the business was unable to continue due to injury, illness or death.
The Right Life Insurance Types for You
Although there are a number of different life insurance types, most Australians will benefit from a comprehensive insurance package that covers life, TPD and trauma insurance. And for working Australians, income protection insurance completes the package.
Virtually all insurance companies in Australia will be able to tailor a package for you that includes all of the life insurance types in a single bundled policy. By bundling the different life insurance types into a single policy you can reduce your paperwork, and importantly you can also save on premiums.
To get quotes and information on the right life insurance types for you simply follow the links on our website.