Life insurance can be a difficult topic to raise with the family. After all, no one wants to think about passing away, especially when you’re bringing new life into the world.
But there’s a lot more to life insurance than simply a single payout in the event of death. In fact, life insurance can play a vital role in protecting your family’s future during your working life, and beyond. It could cover you in the event of a critical illness, or provide for you and your family if you become permanently disabled, and unable to work.
Discussing life insurance with your partner is an important part of looking after your family’s future, and making sure that in case of your illness or injury, your family can look after you!
What is life insurance really?
Life insurance is a family of related insurance products that provide cover for you and your loved ones in the event something happens to you. Life cover is the most well-known component of life insurance. This kind of cover protects your family’s financial future in the case of your death or terminal illness by paying a lump sum to cover mortgage payments, school fees, grocery bills and other living expenses.
Along with life cover, life insurance can also include critical illness cover, and permanently unable to work cover.
Critical Illness Cover
Critical illness cover, also known as trauma cover, pays you a lump sum in the event you suffer one of a number of defined illnesses. Illness can strike without warning, and can create a significant financial burden on you and your family. Critical illness cover includes a number of common conditions such as stroke, heart attack, major organ failure, cancer, coronary artery disease or if you require conronary artery bypass grafting.
Benefits are paid regardless of your ability to work, and you can use them for any purpose you choose – from bills, to specialist medical treatments, to lifestyle changes. Critical illness cover can be added as an option to most life insurance policies.
Permanently Unable to Work Cover
Permanently unable to work cover, also known as total and permanent disability cover, , pays you a lump sum in two main circumstances. First, if you are permanently unable to work due to sickness or injury. Second, if you suffer a major physical impairment such as loss of a limb or loss of your sight or hearing. Such injuries can be devastating and difficult to adjust to. But ultimately, these injuries need not prevent you from living a long and fulfilling life with the ones you love.
Permanently unable to work cover provides the resources you and your family will need to adjust to your injuries and protect your standard of living. This kind of cover can be added as an option to most life insurance policies.
Tips for choosing your life insurance policy
So now you know what life insurance policy options are available, how do you choose the cover that’s right for you? Our top tips are below.
Find out how much cover you need
The amount of cover you need will vary, depending on your age, current savings, and family circumstances. For example, if you have a large mortgage debt to pay, then you’ll probably need more cover than if you own your house. Similarly, if you have more children then you’ll need more cover to provide for them. Seem overwhelming? You can easily find how much cover you need using this life insurance calculator.
Make sure your policy includes guaranteed renewal
Once you’ve picked the right life insurance policy, you’ll want it to last as long as possible, as illnesses and injuries become increasingly likely with age. Before you purchase a life insurance policy, check to ensure that the policy is guaranteed renewalable (subject to ongoing premium payments) and if so, until what age. This may differ between life cover, critical illness cover, and permanently unable to work cover.
Talk to the experts!
Should you require further information regarding any of the covers or assistance in completing an application contact our specialist life consultants to discuss making an application today.
This blog post is sponsored by Allianz
For more information, visit Allianz today at allianz.com.au/life-insurance or call 13 10 00.