How much do you value what you have right now? Whatever stage you are at with your finances, the chances are you have worked hard to get there and would find it devastating if a series of events caused you to lose that wealth. With that being said, a key part of financial intelligence is having knowledge and systems working towards protecting your wealth.
Having the right insurances in place is a key way to protecting your wealth, yet a surprising number of Australians remain under-insured. According to the 2012 Lifewise/NATSEM Underinsurance Report commissioned by the Investment Services Council, 95% of Australians were underinsured, with most set to take a big hit should any disastrous event occur.
Most people do not have enough cover for events such as illness or injury preventing income earners from working, or even enough cover on life insurance policies.
It may seem a little morbid, but here are some important questions which every Australian should consider:
- If I am unable to work, how will I continue to live and pay expenses? (remembering that a medical event can increase expenses further)
- What will happen to my business if I’m unable to work in it?
- If I were to die in the near future, how would my family survive without my income?
The funny thing about us (like many other countries out there) is that we tend to have an aversion to these slightly difficult conversations. “She’ll be right mate” is common vernacular and we shy away from discussing things that are really important. On the other hand, we’re pretty good about insuring our “things”!
If you want to be ensured that your financial future remains secure, it’s time to start having those conversations and thinking about how to protect your wealth. Your home insurance may cover your buildings for a catastrophic event, but it’s not going to cover your mortgage repayments should something happen to you.
There are of course, other areas of wealth protection to explore too, but making sure you have the right insurances is one that every single person in Australia should be looking into, whatever financial position you are in currently. It simply doesn’t make sense to work hard to get to where you are only to lose it due to an event that could have been insured against.
Let’s work toward getting better figures in these reports!