When thinking about insurance, the old adage, ‘better safe than sorry’ rings true. No one likes to consider the unfortunate – injury, sickness or even death, but as we all know these disastrous events do happen and insurance can help alleviate some of the financial stress.
Personal risk insurance is all about providing cover for your family and lifestyle. There are different types of personal insurance including:
- Life Insurance
- Total and permanent disability (TPD)
- Trauma (critical illness)
- Income protection
Appropriate insurance protection allows you to have greater control over your future, helping to manage life’s risks and providing peace of mind that if the unexpected were to occur, you and your family are prepared.
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Your personal circumstances will determine which risk insurance policies are appropriate for you, as well as the amount of cover required. For instance, a single professional would require a different amount of cover to a family with young children, a mortgage, etc.
Life insurance (also known as death cover, life cover or term life cover) – provides a lump sum benefit in the event of death or terminal illness. The level of cover necessary depends on your circumstances, both personal and financial.
Generally, it will be enough to cover funeral services, any outstanding liabilities and will provide an income stream for dependents.
Total and permanent disablement cover – pays a lump sum if you suffer a permanent disability, according to policy definitions.
You must be certified as never being able to work again in either ‘any occupation’ or your ‘own occupation’, depending on the product selected.
Trauma – pays a lump sum upon diagnosis of a specified injury or illness, according to policy definitions.
Income protection – replaces up to 75% of your gross annual income as a payment if you are unable to work due to illness or injury. Premiums are generally tax deductible.
Always ensure you are adequately protected for the future.