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Is it Time for a Personal Insurance Review?

When was the last time you conducted a personal insurance review? If you can’t remember, or never have, it’s been too long! Over the past few years of ups and downs – COVID, inflationary and cost of living pressures, global conflict, and more – people have naturally started thinking quite seriously about what they would do if something happened to them. Whether that’s getting sick, suffering a long-term injury or disability, losing their job, or worse – it’s important to know that you and your family will be looked after. This is where insurance comes in – as well as reviewing your current policies.

It’s difficult to keep on top of all of your finances all the time, but the importance of regularly reviewing your insurance policies cannot be understated. As your circumstances change – marriage, kids, divorce, buying property, changing jobs, even just getting older – your level of cover should be adjusted accordingly. Across a few broad insurance categories, let’s have a look at why reviewing your personal insurance policies is so important.

Income Protection

Your income is your most important asset, and what many of your future goals and aspirations will depend upon. There are several options to choose from, such as the length of the waiting period (how long you have to be off work due to injury or illness before you can claim), ancillary benefits, differences in definitions, and more. Like many things, you get what you pay for with an income protection policy. Quite often, income protection attached to larger company or industry super fund is very low cost, but that’s because it may not cover a particularly wide scope of events. When reviewing your income protection policy, make sure the waiting period is appropriate for how long you’re able to be without income, and that the amount you are insured for is in line with your current remuneration package.

Trauma & Critical Illness Cover

This form of insurance covers significant illnesses such as cancer, heart attacks and strokes by paying out a lump sum to take care of medical expenses, pay off loans or just provide some peace of mind. Overall, the idea behind Trauma cover is to alleviate the financial stress associated with undergoing treatment for a critical illness so you can focus on getting better.

As we get older, even the fittest and healthiest of us can still fall victim to things like cancer and heart attacks. While this reality is scary, having a level of cover appropriate for your age and lifestyle is critical to ensure you’re not caught out should something unexpected happen. For example, a family history of a particular illness is often a motivating factor for people to take out Trauma cover. It’s important to not, however, that insurers may exclude or load a policy based on a family history of a particular condition. In any case, when reviewing your trauma cover, ensure it has sufficient coverage.

Life & TPD Insurance

Nobody likes to imagine themselves being permanently disabled or dying, but the unfortunate fact is that at some point or another, everyone has their time to check out. Rather than leaving your family with undue financial stress at what is already an extremely difficult time, Life & TPD Insurance pays a benefit amount to your family should you become totally and permanently disabled or pass away.

There are some key life events that should prompt a Life & TPD Insurance review. These include marital status changes (marriage or divorce), having children (or having more children), significant changes to your financial situation (particularly if your obligations have increased, you’ve had a pay rise, or have come into an inheritance), and your kids becoming financially independent (and therefore no longer need to be a beneficiary on your policy). That is by no means an exhaustive list, but does highlight the importance of ensuring your policies are up to date and will cover the people that need it most if you were to pass away.

Review Your Personal Insurance Policies with McKinley Plowman

Navigating the complex world of insurance doesn’t need to be a hassle – the wealth team at McKinley Plowman can look at your current personal insurance policies, review your risk exposure, and then develop and implement a solution specific to your needs – giving you and your loved ones peace of mind knowing that there is adequate protection in place should something happen. Importantly, this should be done as part of your overall financial plan.

Like many things in personal finance, the sooner you act, the sooner you can tick it off your list and relax, knowing you’re covered. So, don’t delay – get in touch with McKinley Plowman today via our website or call 08 9301 2200 (Joondalup) or 08 9325 2411 (Perth).

written by:

Hayden Kerdel

Hayden joined McKinley Plowman’s financial planning team in 2020 as a Financial Adviser after four years as the founding director of a successful financial advisory business, contributing to over fifteen years in the financial services industry. Hayden brings to the MP+ team extensive practical knowledge, especially in the areas of superannuation, investments and insurance. He is passionate about helping clients build strong financial behaviours as well as working alongside them to help define a solid plan to help them achieve their financial goals. Hayden also holds a Bachelor of Commerce degree.