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Insurance – don’t just leave things to chance

InsuranceAre you worried about volatility in financial markets and your assets maintaining their value? Risk protection can help provide cover for the most precious things to you, when life throws unexpected things your way.

Many Australians are not adequately protecting themselves from unexpected illness or injury – which, in turn, means they are failing to protect their family and lifestyle. It’s not easy to contemplate how misfortune could affect you or your family but the issue is best not avoided.

“Unforeseen circumstances crop up all the time,” says Michael from Elevated Financial*.

“Unfortunately, it is often only when something unexpected occurs that people realise the importance of protection.”

Insurance provides financial protection for you and your family in the event of serious illness, injury or death. “The financial stress of surviving a serious illness, such as a heart attack, may be even higher than expected due to the associated medical costs and lost income while recovering,” says Michael.

Some expenses that may result from a serious illness include:

  • Paying for specialist or international medical attention
  • Covering the cost of related modifications to your home
  • Paying outstanding debts, bills and daily living expenses while recovering
  • Having to use your savings to replace income whilst off work.

“In an emotional time, finances should be the last thing on your mind,” says Michael.

“And with adequate risk protection, they will be.”

Risk protection provides emotional security for both you and your family, and among other things, ensures your long-term financial goals are maintained – whether you are retired, nearing retirement or still working.

“You work hard for what you’ve got so you don’t want to lose it all in one fell swoop if things go awry,” says Michael.

There are many types of insurance products, designed to protect you and your family in the event of serious illness, injury or death.

“While life cover will help to provide financial security to your family by paying a lump sum in the event of your death, there are other insurance options to consider in case of a serious illness or accident,” explains Michael.

These include trauma, total and permanent disablement, income protection and living expense cover. Trauma cover provides a tax-free lump sum, or instalments, to be paid on the diagnosis of a range of specified conditions including major illnesses such as cancer, heart attack and stroke.

“It could help you maintain your lifestyle under changed circumstances,” says Michael.

The payment may even be used to explore alternative remedies, pay for home care and eliminate any outstanding debt such as a mortgage.

Total and Permanent Disablement cover (TPD) is another option. This type of insurance provides a tax-free lump sum if you are unable to work again due to illness or injury. Income protection is also important because it protects one of your most valuable assets – your ability to earn an income.

“The real value of your income comes from the things it pays for – your home, family holidays and your loved ones’ wellbeing,” says Michael.

Income protection can provide up to 80% of your regular income as a monthly payment, if you are unable to work due to illness, accident or injury.

Another alternative is living expense cover, which offers a range of benefits and waiting periods to suit your needs and budget.

“It is designed for retirees, casual employees, homemakers or those who just want a basic level of cover, and provides cover up to age 80 for up to a maximum benefit of $3,000 per month,” says Michael.

“If the person insured becomes significantly disabled, the monthly benefit may enable them to pay day-to-day living costs and stay in their own home longer, or can help with the costs of either in-home carers or a long-term care facility.”

Give yourself some peace of mind. Risk protection helps you cover the things that are most important to you and is therefore an essential part of any financial plan. Protecting your wealth, and in turn you and your family’s lifestyle can be addressed in many ways. An adviser can help you work through the different types of policies and can guide you on which protection best suit your needs.