Our CFO Greg Taylor says we insure our cars but don't always look at insuring a even more important aspect of our lives - our income. He takes you through the four main types of personal insurance to help you decide if any are right for you.
Did you know that 83 per cent of Australians say they have car insurance, yet only 31 per cent insure their most valuable asset - their income? We insure our homes, health and holidays but personal income insurance is often relegated to the ‘do later’ list.
For many businesses the owner is integral to the business. If you are a small business owner, what sort of plans do you have in place in the event of an unexpected injury, illness or even death in your family? How would you protect yourself, your loved ones and your assets?
There are four main types of personal insurance.
Life insurance provides a lump sum payment to your family if you die.
Total and permanent disablement insurance provides a lump sum payment if you become totally and permanently disabled and cannot work again either in your own or any other occupation.
Income protection provides a monthly benefit, up to 75 per cent of your income, if you become unable to work because of illness or injury. It helps to make sure your bills continue to be paid while you are not working. You can also choose to cover your super contributions.
Trauma insurance provides a lump sum payment to help you recover from things like cancer, a heart attack or a stroke. (Health insurance may help pay hospital bills but it generally won’t cover lost earnings.)
You may have some insurance cover within your super. It is important to check those policies to see how long it takes to access money and exactly what is covered.
Insurance costs money. You may weigh up the risks, benefits and decide some or all are not for you. A key question to ask yourself is could you survive without your income and how important is maintaining your existing lifestyle?
When choosing insurance shop around and check the definitions, inclusions and exclusions to make sure it meets your needs. If the insurance is cheap, it may mean you’re missing out on benefits.
This post is from Greg Taylor’s weekly Business Finance Column in the Newcastle Post newspaper.
The Greater can help you with all your insurance needs - from personal insurance to car and boat insurance, travel insurance to home, contents and landlord insurance. Call our friendly and expert insurance team today on 1300 550 855 or ask a question below.