You’ve got your biggest asset protected with insurance, right? Of course, it’s only natural. I mean you wouldn’t want to lose the most valuable thing in your life would you?
Now you might think I’m talking about your home or your investment property. But in reality the biggest asset you have in your life, is you. Your ability to work and earn an income is what makes everything else in your life possible.
Everyone insures their home and contents. We all do. No one would dream of buying a home and not protecting it. Yet much fewer people take out insurance to protect their very ability to earn the money that pays the mortgage that makes owning their home possible.
Which, as an insurance expert, I find amazing.
I constantly see people working hard to get ahead in life and not taking the simple steps to protect everything they are building up. In fact industry research shows that the overwhelming majority of Australians have inadequate personal insurance.
This is often because they don’t actually know the risks. Let me point out a couple.
You protect your house against fire right? Yet according to research, you are four times more likely to lose your home because someone in your family died than you are because of a fire. And if you think that’s amazing, consider this, you are 38 times more likely to lose your home because of an accident or injury.
That’s why there’s been so much focus in recent years on personal insurance, such as income protection and disability cover, as well as the regular “life insurance cover”. Let’s face it, if you’ve paid a lot off your home or investment property then you’ve built up quite a bit of equity but if you’re not well enough or able to work and make the repayments or worse still, you can’t make the repayments because you’re no longer around, you really don’t want your family to be forced to sell the family home or investment property.
A good financial advisor or financial planner can show you how to organise your insurance through your super fund. Not only can it be cheaper to do it this way, it’s easier because the premiums come out of your super. While this might eat into your retirement nest egg a little, the reality is you don’t have to reach into your own pocket to pay for them with your after-tax income.
Ultimately remember what you’re doing is buying protection for your assets and your family, which could cost you a lot more if you didn’t have the cover.
So what sort of personal insurance should you have? Well there are a few different types:
- Life insurance is where your beneficiaries (usually your loved ones) receive a lump sum if you die or become terminally ill
- Income protection insurance will pay you up to 80% of your pre-tax salary if you find you can’t work due to injury or illness
- Total Permanent Disability Cover protects you with a lump sum should you become totally and permanently disabled
- Trauma Insurance will pay you a lump sum if serious illness like cancer, a heart attack or stroke knocks you down
If you think you don’t have the cover you really need to protect all your hard-earned assets, please fell free to contact me, Damian Espinosa at firstname.lastname@example.org or call me on (03) 9868 7500