Since my days working as a bank manager I have understood the importance of insuring myself (not just my car or house, me the person), whether it be some level of income protection, trauma or life insurance because you just never know what’s around the corner.
Given the unprecedented circumstances we find ourselves in with the COVID-19 pandemic, I believe now more than ever you should be reviewing the insurances you believe to have in place especially if you have a home loan.
Whilst I can understand people look at this as just another expense and may not see the importance in it ask yourself – “how will I pay the mortgage if something were to happen to me and I could no longer work?”.
I caught up with my insurance guy the other day, as I do every year to review our insurances, and asked him why I hadn’t seen or heard from him in 12 months. He went on to tell me he’d been off work because he had bowel cancer! I was quite shocked to hear this because he’s not even 30 years old and so it was the last thing I expected him to say. He had no history of this in his family and he was just unlucky according to his doctor.
Fortunately, he had taken out trauma insurance years before and was covered. By having this insurance in place, it meant that he was not only able to pay for any treatment he required he was able to take 6 months off work to receive the treatment all whilst still being able to pay off his mortgage. As a young guy who had recently been married and had just had their first child, this insurance payout was a life saver.
I’m covered in my superannuation
Now I know most of you might think you’re covered within your superannuation, but I can almost guarantee that for most of you that’s just an assumption and that you don’t really know what your superannuation covers you for. Do a health check. Call up your superannuation fund and find out exactly what type of insurance cover you have and confirm how much you are covered for. If it’s not sufficient for your current situation either talk to your superannuation company about increasing your cover or get additional advice from an insurance expert.
Review it annually
I’m sure your circumstances don’t look the same year after year, so it’s important to review your insurance policies annually. When you first took out your insurance policy maybe you were single and renting, but over the years you have gotten married and bought your first home. The cover you had two years ago therefore, may no longer be suitable.
Sit down annually and review all of your insurance policies to ensure they suit your current situation, and to ensure you are getting the best value for money as the premiums will vary across different providers.
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