Most Australians insure their house, contents and cars, but many don’t look beyond those obvious everyday items when thinking about insurance. Whilst many Australians are protected by a level of life insurance within their superannuation funds, a lot don’t really consider what those sums will protect in the event of their death. Here we address two of the most important types of insurance to consider and the reasons why.
1. Life Insurance
When considering your life insurance needs, it’s important, but hard, to actually take a look at what the picture will look like when you’re gone. Will your partner be able to take care of themselves? What about your super – where’s that going when you are no longer here? Do you need to consider the needs of your children, what about the mortgage?
It’s not easy to consider all these things at once and prioritise how much will be needed to protect your family, so talking to an insurance specialist can help you work through all these issues and work out what’s really important to you and what level of cover you will need.
2. Income Protection
A lot of risk professionals actually find it strange that people insure their house, contents and car, but fail to insure their biggest asset – you! Your ability to earn an income is your greatest asset and life will certainly look a lot different if you were to lose that ability, so isn’t it worth considering protecting it?
If you have a partner and children to consider and are the primary income earner, how is your family going to cope if you are unable to work? Salary continuance or income protection options are sometimes available through your superannuation fund and may offer a cost-effective way to protect some of your income. However, a retail income protection policy may provide far greater benefit, if you are able to pay for at least some of the premium from your personal cashflow.
Retail insurance policies can offer agreed benefits, benefits to age 65 or even 70 in some cases, depending on your occupation and also offer a host of additional features to help you manage while you are ill or injured. Working out which policy can offer you the benefits you need, at a cost you can afford, is an important aspect of considering which income protection product is right for you. Working with a financial adviser who understands the various types and aspects of the many different policies available can not only save you in the long run but also ensure you get the benefits you need when you need it most.
The number one thing to remember when thinking about personal risk protection is – insure what you can’t afford to lose. The right insurance can help you protect what you value most, so do your research to make sure you get what’s right for you, or better still, talk to one of Coulson Financial’s qualified risk professionals to help you with the task.
By Liz Corbeau DFP