Under-Insurance It Isn't Trendy

As Australians, we do know a growing trend when we see one.

Let's think about a recent trend we are all guilty of taking a part of; When It all of a sudden became “cool” to have a personal trainer or “cool” to be forever starting a new diet! Don’t get me wrong these are potentially decisions that lead us to a healthier lifestyle, the point here is that we are all guilty of following a trend at one stage or another, whether sub-consciously or not.

On the other side of the coin, are all the trends we follow necessarily a smart decision? As a Nation, just 4% of the population with dependent children have adequate insurance cover and this is a trend that is not increasing. Leaving the remaining population not knowing how much insurance cover they need, or even if they have any insurance cover at all.

Now is this a case of lack of knowledge? Lack of awareness? Or the old adage of the “Invincible Bronzed Aussies?” Actually, neither of the fore-mentioned!

In fact, there is plenty of information, advertisements and warnings in various forms of media to promote insurances and the devastating events these products aim to protect against.

Instead, this trend has come about due to a lack of action and often put in the too-hard basket. Lets face it, insurances can be quite a morbid topic but the reality is, The Australian Bureau of Statistics states that three in every four Australians will be diagnosed with a Critical illness during their lifetime. Now that’s not cool.

How do we reverse the trend? Well, short of having insurance sales people on every street corner, the barriers between receiving quality insurance advice need be broken and the message of “how much cover is enough” needs to be strengthened.

If you are reading this thinking that Hey! If everyone is being active and eating properly then the need for insurance decreases right? Yes, to a degree but sadly not the whole story. In short, only a small number of critical illness are actually preventable by our lifestyle choices and no amount of healthy eating can protect us from an accident.

Nor can an insurance policy right? True! But what an adequate level of insurance coverage does is give you options….

The option to take time off from work to fully recover.

Pay down your mortgage to leave a debt-free home to your family.

Pay-you a Tax-Free lump sum to receive the best treatment.

Replace a portion of your income until you are back at work.

Adequate insurance does not have to mean that your surviving spouse or children live a life of luxury and it doesn’t have to mean the family is eating baked beans 3 nights of the week just to pay for this cover. Adequate insurance means that at the time of claim you or your family have options and that financial burden is the last thing on your mind, whatever this looks like.

The “cool” thing is that, with various structures available and the potential to have insurance costs not affect your cash flow at all, there are certainly ways to provide an adequate level of cover.