Most of our lives are spent working to build up our assets. Our home, car, boat, superannuation, insurance and other investments provide us with the lifestyle and security we want for our families. But what happens to all of these things if we become ill, incapacitated or pass away?
At Wahlstrom Financial Services we pride ourselves on providing our clients with the peace of mind that they will have money when they need it most. Personal Insurances are something that many Australians overlook when discussing their financial future. Having the appropriate covers in place can help you to keep you and your loved ones protected financially when the unexpected happens (such as death or disablement).
There are four main types of personal insurance, Income Protection, Life Insurance, TPD Insurance and Trauma Cover.
Income Protection insurance provides you with a regular income if you are unable to work as a result of illness or injury. It may also be known as 'salary continuance insurance' and generally provides income during a period of disablement up to a predetermined and agreed benefit period. Note that Workers Compensation will only cover you for accidents or injuries that occur during working hours or for an illness that is a direct result of your employment.
Life Insurance is also known as term life or death cover. These policies pay a predetermined cash lump sum to the nominated beneficiary if you were to die. These funds are often used to:
Repay debts e/g/ Mortgage, personal loans, credit cards, personal guarantees or other large debts
Clear hospital, medical or funeral costs
Provide an income for your dependents, to pay for their living expenses, school fees, child care etc.
Life insurance policies may include an option to include cover to make a payment if an injury or illness causes you to never work again. These types of inclusions are called Total & Permanent Disablement.
Total & Permanent Disablement Insurance
Commonly known as TPD insurance, this type of cover typically pays a lump sum if you suffer a permanent disability, which meets the definitions within your policy and which prevents you from working. Generally this type of cover pays a benefit if you become permanently disabled (as defined in the policy). This would mean that you cannot work in your current occupation or work in a job you have trained or studied for or previously worked in.
Trauma Insurance pays a lump sum upon diagnosis of an injury or illness as specified in the policy (for example stroke, blindness, cancer, severe burns, loss of speech or deafness). It is also known as critical illness cover.
If you run a business and become ill or injured and couldn't work, how would you keep your business going? Insurance covers can also be provided for 'key people' in your business. Often the costs associated with key people not performing their roles is underestimated, recruitment costs and downtime while retraining a new person can have a major financial impact on your business. This 'key person' cover can be extended to include death, total and permanent disability and trauma.
We have solutions for business owners, call us on (07) 5574 0667 to ask how.