Life Insurance, are you fully covered?

December 12, 2018
Shae Aiello

As credit advisors, it is also our role to check with our clients to make sure they have adequate cover for life’s unexpected events.

Many of our clients know that they have life insurance, but aren't exactly sure what their cover entails. The majority tend to say, “we’re okay, it’s in super.”

Bryan McGuinness, our Mortgage Choice Financial Planner, explains that we really need to take the time to discuss whether this cover is adequate for your needs and also whether your circumstances have changed since you initially took out your policy. With the guidance of an experienced Financial Planner like Bryan, it could be possible to get cheaper cover outside of super, with more benefits.

Results of a survey by Superannuation researcher Dexx&r revealed that several years of significant hikes in group premiums means super based insurance is NOT necessarily the cheapest. Mark Kachlor, the Principal of Dexx&r, advised,

”It is no longer true for risk benefits offered by many of the larger industry funds, that long held belief that this cover will be more cost effective than holding comparable cover outside super”

Take a moment to consider what would happen to you or your family if you suffered long term injury or illness? Who would pay for the mortgage and other household expenses? What if something happened to your spouse, would you be forced to give up your job to raise your family?

Buying Life Insurance

For many, buying life insurance never quite makes it to the top of our priorities. We're all time poor these days, and we’ll insure our cars and our homes, but often neglect the most valuable asset - our ability to earn an income. Now, with the help of an experienced financial planner like Bryan, it has never been easier.

What it covers

Life insurance covers a number of different types of products - it’s not just a lump sum paid in the event of death. Other cover includes total and permanent disablement, trauma, life cover and income protection.

Income protection is one of the most important personal insurances to have. An added bonus here is if you purchase outside of super, your premiums are a tax-deductible expense.

The three ways to buy life insurance
1. Direct from the insurer (online)

Buying direct is an option of DIYing your life insurance. It will be up to you to decide what type of policy you require, policy conditions and sum insured to suit your needs.

The big disadvantage of DIY is that you’re not receiving professional advice and possibly not getting the type of cover best suited to your particular needs.

2. Through Super

Premiums are deducted from your superannuation instead of coming out of your budget.  There are, however, some disadvantages of life insurance through super.  For example, policy conditions and product types can often be limited and the payout of your super and associated life cover is at the discretion of the trustees of that super fund. And, upon your death, funds may not end up being paid to your preferred beneficiary.

3. Advice from an adviser

Receiving professional advice from an experienced professional like Bryan helps avoid misunderstandings and confusion as well as the risk of underinsurance. You’ll receive expert advice to ensure you purchase insurance that best meets your needs. It may also work out to be more cost effective!

Speak to Mortgage Choice in West Perth's Financial Adviser Bryan McGuinness today on 6144 3230 about how you can protect your quality of life. It can certainly ease any financial burden in the future.

 

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Posted in: Financial planning

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