Right now the Australian family budget is being stretched from all sides and fitting personal insurance onto the family shopping list is becoming more difficult.
An AXA study1 examining Australian attitudes towards life insurance found that while most people understand the necessity of insuring everyday items like their home, car and medical health they regarded life, income and trauma insurance as a lower priority.
The main reasons for the generally low level of interest in personal insurance were:
• the emotionally confronting nature of the topic
• an uncertainty about what constituted an adequate level of life insurance, and
• the perception that life insurance doesn’t give them any immediate tangible benefit.
Not surprisingly, people don’t like to contemplate their own passing or that of loved ones. But the study also found that once people were alerted to the importance of insurance, they were inspired to take action and ensure their level of cover was adequate.
Peace of mind you can’t touch
No one likes to imagine injury, death or illness happening to themselves or their family. But the truth is that insurance can be a great way to gain some peace of mind and help alleviate the financial worry associated with some of life’s uncertainties.
While it’s true that insurance isn’t a product you buy for immediate use, it can help answer some of life’s great questions. Consider, for example:
• Who will be there to look after your family or pay your outstanding debts if something happens to you? Alternatively, what would you do if something happened to your partner?
• How can you protect your family from the financial impact of you becoming totally and permanently disabled?
• What are the financial consequences if you suffer a serious trauma, such as a heart attack?
• How would your family cope if an injury or illness prevented you from earning an income? How would your life change if your partner suffered an injury or illness which prevented them from either working or undertaking home duties?
Insurance should be an odds-on favourite
When it comes to the age-old question of ‘How much insurance is enough?’ the answer turns out to be a very personal one. The level of insurance that suits your individual needs and those of your family will ultimately depend on your individual circumstances.
A professional financial adviser can independently asses your needs and provide a detailed recommendation on the right level of insurance for your situation. For more information and a no-obligation appointment, give ipac a call on 1800 626 881 today.
1 ‘Australian attitudes to underinsurance’, TNS Research, March 2007.