By now, we should all know the importance of life insurance and how it plays a vital part in our family’s lives. But what you may not know, is that it is not just a set and forget type of deal. Your need for insurance will drastically change throughout the course of your life.
The following events are ‘trigger events’ which will reveal the need to review different levels of personal cover:
- New (or pending) dependants, including children, aged parents or disabled children;
- Recently married, divorced or separated;
- Partner not working (responsible for children);
- New job, occupation or business situation, e.g. establishing a partnership or shareholding in a business;
- Redundancy or salary increase;
- Inheritance of a bequest;
- New, or increased debt e.g. purchase of an investment property or obtaining a business loan;
- Positive changes in your health, e.g. you may have quit smoking, lost weight or had a medical issue level out.
While it is vital to review the levels of cover, it is just as critical to review the product itself. Insurance companies often review and/or upgrade the benefits in their policies to provide superior products to their customers. Some of these improvements may be attributed to advances in the medical field, for example, there may be changes in the way doctors diagnose a patient’s heart attack. Or the insurance companies added benefits to the policy, for example, 20 years ago, a typical trauma policy only insured for up to four major health events. Today, some contracts can provide benefits for upwards of 40-50 events, depending on the insurer.
You also want to ensure your policy is still competitively priced. Every year when the renewal letter shows up from the insurance company, no doubt we all wince at the increase in price. Sometimes we just bite the bullet and pay, other times we start to doubt the need of insurance and decide to cancel. Insurance companies know the strain of increasing premiums can have on families so they are starting to implement incentives which enable you to receive discounts. Some of these may be in the form of multi-policy discounts (for example, a husband and wife apply at the same time), multi-cover discounts (holding life, TPD, trauma and income protection), and health and wellness programs.
At The Investment Collective, we try to schedule annual reviews with our clients to ensure their risk protection strategy continues to meet their goals and objectives. If it’s been some time since your last review, or since your cover was put in place, please contact one of our specialised Risk Advisers.
The above advice has been provided as general advice only. It has not taken into account your personal insurance needs or current coverage. It has not considered your personal information in any regard. If you would like to learn more about how the above advice can be customised to your personal situation, please contact one of our experienced and knowledgeable insurance advisers today.