While most people would never consider driving a car without some form of motor insurance, less than a third of us insure our most important asset – our ability to earn an income.
Research has shown that Australian’s consistently do not take out adequate levels of insurance to protect themselves and their family. In fact, research commissioned by IFSA in 2005 showed parents with dependants were critically underinsured by $1.30 trillion!
Why is this a problem?
During your lifetime, there’s a pretty good chance that you’ll encounter situations where a bit of financial help wouldn’t go astray:
- More than three in four Australians will be diagnosed with a serious illness in their working life [1].
- Every 22 minutes an Australia dies from heart disease [2].
- 1 in 2 Australians will be diagnosed with cancer by the age of 85 – over 60% of whom will live for longer than five years after diagnosis [3].
- One stroke occurs in Australia ever 12 minutes [4].
In these instances, the majority of us would rely on savings, or resort to the fire sale of assets in a depressed market or government welfare. And a significant proportion of Australians would face financial hardship if they were to have an accident, become sick or die.
How will having life insurance benefit me?
Common rebuttal to insurance from clients include that they are fit and healthy and rarely even come down with a common cold. Given the above statistics, who knows that will happen around the corner?
Another common issue is disrupting an already tight budget with insurance premiums. However, quite often this can be overcome by funding premiums through your superannuation account balance. The premium in certain circumstances may even be tax deductible.
It is plain to see that wealth protection should be the cornerstone of a good financial plan.
Suffering from a serious illness or overcoming the death of a family member can be made even more stressful if you’re struggling to meet your financial commitments.
By having Life Insurance, you can rest assured that your family will receive a lump sum in the event of your terminal illness or death. This means your family can focus on themselves instead of the finances.
[1] ABS Statistics
[2] Heart Foundation
[3] Cancer Council Australia
[4] National Stroke Foundation
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I agree with this. Some people just don’t realize how important it is to be insured not until they’re in a bad shape and needs it badly. I am saddened sometimes that mostly think of insurance as an added not-so-important expense. From the article above, your family deserves a life after you’re gone. Wouldn’t you be happy if your family considered you really cared even after you’re gone? Think of it…