Are your family, friends or adult children part of the large percentage of Australians who are under-insured? Here’s a simple guide to stage-of-life insurance priorities.
Research indicates that the majority of Australians are under-insured. Rice Warner’s recent report,1 for instance, said the median level of life insurance for working-age Australians covered only 42% of the financial needs (to maintain their standard of living) of remaining family members.
The first call for insurance advice should be a financial adviser. Here are the areas they are likely to cover.
This is a wonderfully busy and social period, but if you’re unable to work for two or three months, perhaps due to an injury on the ski slopes or an illness, how will you pay the rent or save for a house deposit?
Income protection is essential, plus a choice of TPD or Trauma insurance (explained below) is also recommended. A financial adviser can help figure out exact levels of cover required.
Income protection – covers up to 75% of current income, subject to a waiting period. Premiums may be tax deductible.
Total & permanent disability (TPD) – if you are permanently disabled and cannot work again the insurer pays a pre-agreed lump sum.
Trauma insurance – if you are diagnosed with a particular life-threatening illness covered by the policy, the insurer pays a lump sum.
NEXT WEEK: Family with young children
Disclaimer: Information in this article is based on current regulatory requirements and laws, which may be subject to change. While care has been taken in the preparation of this document, no liability is accepted by Count, its related entities, agents and employees for any loss arising from reliance on this document.
This document contains general advice. It does not take account of your individual objectives, financial situation or needs. You should consider talking to a financial adviser before making a financial decision.