Whether you’re buying a home to live in, or a property to rent out as an investment, knowing what insurance to have in place ensures your assets are protected. But how can you shop around for the best possible insurance deal to suit your needs? These tips will help – and remember to always check the fine print!

Most Australians understand the importance of appropriate insurance for their vehicles but when it comes to protecting their most valuable asset – their income and their health – it’s estimated that less than one third of Australians take the steps to put the right insurance in place.

How would unexpected illness or injury impact your family?

When it comes to creating a sensible financial plan for you and your family, insurance is one of those things that too many people ignore. Yet, all the saving and property investment strategies in the world won’t save you if unexpected illness or injury leaves you unable to earn an income to service your home loans.

To decide what level of personal risk insurance is right for your circumstances, ask yourself these questions:

  • Could you (and your family) survive without your income?
  • Would available Centrelink benefits be enough to cover your expenses?
  • Could your family continue to enjoy its existing lifestyle?
  • Does your sick leave as an employee cover long-term illness?
  • If you answered ‘no’ to any of these questions, your insurance needs reviewing.

4 Main Insurance Types

Life insurance – in the event of your death, this provides a lump sum payment to your family.

Total and permanent disablement (TPD) – this lump sum payment is if you become totally and permanently disabled and cannot work again – either in your own occupation, or in ‘any occupation’.

Income protection – this monthly benefit can cover up to
75 per cent of your income, if illness or injury means you can’t work for an extended period of time.

Trauma insurance – a lump sum payment to help you recover from a trauma or crisis (including cancer, stroke or heart attack, for example).

Many people already have these insurances within their super. It is important to check your policy to see if you are covered – and read the fine print to see if the cover is adequate. Basic insurance cover within super funds is rarely personalised to suit your individual circumstances and may not provide the financial support you really need.

Top Insurance Tip

If your insurance is cheap, it is almost certainly inadequate, or may have too many clauses that making a successful claim will be challenging. If you’re planning a major purchase, or need to know the ones you’ve already made are properly protected, ask a specialist insurance broker to check your existing policies to see if you can access a better deal.

If you need advice for a home loanbusiness or commercial loanself-managed super fund loan, or an investment home loan, speak to a broker at Lending Specialists. We have a wealth of experience under our belt and a robust network to connect you to the right industry professional for the loan you need.