Insights
How long would your savings last if you could not work? Not a week. Not a month. A sustained period, six months, a year, longer.
For most Australians, the honest answer is uncomfortable. The average household savings buffer is not large. Most people have enough to cover a short-term disruption, not a serious one. Income protection insurance exists to bridge the gap between the end of your savings and the point where you can work again.
Around 44% of Australians have no life insurance outside of what sits inside their super fund. Of those who do have some cover, a significant portion are underinsured to a degree that would leave their families in serious financial difficulty. Research from Rice Warner, cited by the Financial Services Council, has estimated that the average Australian family has life insurance cover equal to only about 61% of what they actually need. That gap does not feel abstract when you start putting real numbers to it.
If you've ever sat down to sort out your personal insurance and come away more confused than when you started, you're not alone. Life insurance, TPD, income protection, trauma cover and business expenses cover all sound similar, but each one plays a very different role in protecting you, your family and your livelihood.
Here's a plain English guide to what each type of cover actually does, and why you might consider it.
If something happened to you tomorrow, would your family be able to stay in your home?
Not "would they be sad" (of course they would). Not "would they manage somehow" (people always find a way to survive). I mean specifically: could they keep paying the mortgage, keep the kids in their school, keep the life they've built, without you bringing in an income?
Shire Accounting Services | Shire Buyers Agents | Shire Financial Planning | Shire Mortgage Brokers
0449 231 238
Unit 42 / 10 – 18 Robertson Street, Sutherland, NSW, 2232
