Life isn’t without its challenges. Typically, it’s human nature to face these head on, evaluating and assessing each obstacle as it surfaces, but one thing is for sure, no one can predict what the future holds.
What if you were to suffer an accidental injury that rendered you unable to provide for your family? What if you were to lose a valuable staff member that left your business unable to survive?
Should the unthinkable happen and you were left in such a difficult situation, one completely out of your control, are you confident that your insurance policy would adequately protect you and those most important to you?
Avoid these common insurance mistakes
We are fortunate enough to be in the unique situation where we can review and assess insurance policies for a wide array of individuals and business. From farmers to tech start-ups, singles, couples, families and retirees, we see the number of common mistakes that arise; mistakes that don’t discriminate by industry type, gender, age or marital status.
Getting the basics right
Some view not having adequate insurance as an opportunity to save. Simply put, not having the right insurance can be detrimental to your financial affairs and end up costing you a significant amount in the future. For example, it’s important to ensure you have the appropriate car insurance that covers you or your family members in the case of an accident or theft. It’s vital to have appropriate health insurance for you and your family in case of an emergency. It’s critical to have renters or homeowner's insurance in order to cover the risk of theft or fire.
While it’s understandable that insurance is costly, having protection for the basics is a necessary measure that must be taken to minimise your exposure to risk over the life of the asset and when done correctly, can be less costly than you think. Your local insurance advisers can help tailor a plan that won't exceed your budget and ensure that you are always adequately protected.
Choosing your insurer on price alone
It’s understandable why so many individuals look simply for the cheapest provider. What you must be aware of is that many policies are priced lower because the coverage they sell could be less comprehensive. Before you make the decision to purchase any insurance policy, we suggest you identify your insurance needs and review your coverage appropriately to ensure it supports your expectations.
It’s also important to remember that insurance policies do vary in price, and as such it’s important to perform sufficient research. It doesn’t take much time to shop around for insurance policies every two years to ensure your policy is both comprehensive and competitively priced.
Some of the most common insurance mistakes are miscalculations. These might be around the cost to replace your home, its contents, valuables or equipment for your business. When it does come time to taking out or renewing your insurance policy, ensure you update the value of your items to avoid being left in the dark when you require cover.
Remember, costs associated with building a property have increased dramatically over the last decade. Ensure your cover takes this into consideration when evaluating your property price.
Getting the wrong insurance
Selecting the wrong types of basic insurance or having too many policies can cost you significantly. Don’t waste your time and money with policies that you are not likely to use and may not appropriately cover you when needed. Make sure you understand the policies that you’re getting as well.
If you feel like you need help, call your local adviser who will be able to provide you with guidance and support to ensure you have the policies that are right for you.
Tailoring the right insurance for your unique situation
It can be extremely confusing when selecting policy types as there are a variety of differing insurance policies available in the market today.
For example, Income Protection insurance is designed to pay a regular monthly income should you be unable to work through illness or injury. Insurers will usually insure up to 75% of annual income plus super and various combinations of waiting and benefit periods can apply. Premiums are usually tax deductible and cover is 24 hours a day worldwide.
Life and Total & Permanent Disability insurance can provide a lump sum to be used to clear debts, provide an income for the surviving spouse and provide funding for children's education.
Total & Permanent Disability insurance can support medical and rehabilitation costs. Another form of lump sum insurance is Trauma cover which pays on the diagnosis of a specified medical condition such as cancer, heart attack and stroke.
Buy/Sell insurance is also an important consideration for a family owned business. A legal agreement such as a buy-sell or option agreement can clarify succession and provide protection from sudden death or disability of key family members.
Because you never know what’s around the corner
It’s extremely important to ensure you have the right insurance cover in place to suit your unique situation. If you’d like to have your circumstances reviewed, we encourage you to contact your local risk and general insurance specialist. They will be able to assess your current insurance situation at no additional cost and provide guidance around areas of potential exposure, devising a strategy to ensure you are appropriately covered to address any issue that might arise.