27 August 2021
Many professionals will acquire significant financial assets over their working life. A family home, superannuation savings, a share portfolio, a prestige car, perhaps an investment property or two.
And yet the biggest financial asset you’ll ever own is the one you see in the mirror every morning: you, and your ability to earn an income.
For many professionals, the future value of their lifetime earning potential could be several million dollars or more. Everything you plan to build – your assets, your debts, your lifestyle, your family’s security – hangs on the expectation of a substantial regular income.
But what would happen if that income abruptly disappeared for many months – or even permanently? What if you could never work in your profession again – or even work at all?
Think you don’t need insurance?
Imagine you suffered a major injury or were diagnosed with a serious illness and had to take time off work – perhaps many months – to recover. What would losing your income mean for you financially?
- Could you afford the sometimes huge cost of medical treatment?
- Could you keep paying your home loan or other debts?
- How long would your savings last?
- Would you be forced to go to your family, friends or even the bank for help?
This is where insurance comes in. So that if something happens to you, you get financial assistance to help keep things in your life running smoothly. All you should be worrying about is getting better.
The different types of insurance
1. If you suffer a serious illness or injury
Income Protection: Pays an ongoing monthly amount to help replace majority of your income, so you can focus on recovering without stressing about meeting your regular living expenses.
Trauma Cover: Pays a one-off lump sum if you suffer a serious medical condition such as cancer or heart attack. It’s paid as soon as the condition is diagnosed, and you can spend the money on whatever you like – to help with medical expenses, pay down debt, or take the holiday of a lifetime once you’ve recovered.
2. If you die or suffer an illness or injury that leaves you totally and permanently disabled
Total and Permanent Disability (TPD): Provides a lump sum payment if you become totally and permanently disabled and can’t return to work. These benefits are often used to eliminate debt and fund long-term medical expenses and the costs of ongoing care. The majority of TPD payouts are for mental health conditions, musculoskeletal issues and accidents.
Life Cover: Pays a lump sum to your estate if you die or become terminally ill. It can therefore help ensure that your partner or other dependents can clear all debts – such as a home loan – and have financial security for life.
Putting a plan in place
For most busy professionals, researching and organising life insurance cover can seem like a time-consuming headache. But this is where a financial adviser comes in.
As experienced financial advisers, we have an intimate knowledge of the product features and options that can help save you time, money and hassle. For example, some insurers let you automatically increase your levels of cover as your salary increases and your life changes, without you needing to undertake additional medical checks.
There’s never been a better time to protect your income. For assistance with establishing cover or reviewing your income protection policy, contact our insurance experts today.