Build your financial security with OBT Financial Group – Lockyer Valley Business of the Year recipients and specialist financial advisers to individuals, business owners and farming families on accounting, tax, business advice and wealth planning for over 40 years.Protecting Yourself and Your Loved Ones
Life is unpredictable and unexpected events such as accidents, illness or death can occur at any time.
Having personal insurance can provide financial protection and security against such events. Insurance cover can help with expenses such as funeral costs, outstanding debts, living expenses and ensure that your loved ones are not left struggling financially.
In this article, we outline five important facts you should know about personal insurance before purchasing cover that’s suitable for your circumstances.
1. Personal insurance provides protection
The primary purpose of personal insurance is to provide financial protection against unexpected events. Depending on the type of insurance you have, it can cover medical expenses, loss of income, funeral costs and other related expenses. Without insurance, you or your loved ones could face financial hardship and struggle to cover these costs.
2. Insurance premiums are based on various factors
Insurance premiums are typically based on factors such as age, health, lifestyle and occupation. For example, someone who engages in high-risk activities or has a pre-existing medical condition may pay higher premiums. On the other hand, a younger person with no significant health issues may pay lower premiums.
Insurance policies also have exclusions and limitations that may affect the coverage you receive. It’s essential to review your insurance policy carefully to understand the coverage limitations and exclusions set out by each provider.
3. Employers may offer group insurance plans
Many employers offer group insurance plans to their employees, which can provide cover at a discounted rate. If you’re employed, check with your employer to see if they offer a group insurance plan to their employees and what coverage is provided.
4. Cover depends on your circumstances
The amount of insurance cover you need will depend on your individual circumstances, such as your income, expenses and financial obligations. For example, if you have dependents, you may need more life insurance coverage to provide for their needs in case of your incapacitation or death.
5. Coverage levels and deductibles affect premiums
It may sound obvious, but it’s good to reiterate that insurance policies can have different levels of coverage and deductibles, which can affect the cost of premiums and the amount of coverage you receive. A higher level of coverage or lower deductible will typically result in higher premiums, while a lower level of coverage or higher deductible may result in lower premiums.
Personal insurance cover provides peace of mind, knowing that you and your loved ones are financially protected in case of unexpected events. Knowing that you have adequate insurance in place can help reduce the stress and anxiety of potential financial hardship.
Regular review is critical
It’s essential to review your insurance policy regularly to ensure that it still meets your needs and provides adequate coverage. As your life circumstances change, your insurance needs may also change. Regularly reviewing your policy can help ensure that you have adequate coverage and avoid any surprises when you need to make a claim.
Seek Professional Advice
Insurance is a complex area and it’s critical to have a clear understanding of what you’re purchasing. A financial advisor can help you navigate the nuances of insurance and help you find the right cover for your needs.
OBT’s Private Wealth Advisors can help you to assess your financial situation, set goals and develop a plan to achieve them. Contact our Financial Planning team in Gatton or Esk on 07 5462 2277.
Private Wealth Advisers Bruno Tjelder and Damon Zischke and OBT Financial Planning Pty Ltd are Authorised Representatives of OBT Wealth Services Pty Ltd ABN 13 661 409 838 | AFSL 543251.
The information provided is general in nature. It has been prepared without taking into account any of your individual objectives, financial situation or needs. Before acting on this advice you should consider the appropriateness of the advice, having regard to your own objectives, financial situation and needs. This Financial Planning website page(s) is intended for Australian Residents only. The views expressed in this publication are solely those of the author; they are not reflective or indicative of the position and are not to be attributed to the Advice Licensee. They cannot be reproduced in any form without the express written consent of the author.
