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Is your Personal Insurance Adequate?

The purpose of personal risk insurance is to maintain your lifestyle and financial prosperity when something goes wrong.  There are several types of health risks that you should consider but there is only one outcome that is important.  That is, to have the right amount of money delivered to the right person at just the right time it’s needed.

You already know that things go wrong in life, so ask yourself these questions:

  1. “If I die before my time, where would the money come from to keep the house, pay the bills, as well as raise and educate my children?”
  2. “If I had a serious accident and could never work again, could I / we get by for the rest of our lives with added costs of rehabilitation?”
  3. “If I developed cancer, could we afford the one or two years of out-of-hospital (out-of-pocket) treatments that most recoveries entail?”

When you arrive at a realistic answer, check your super to see how much insurance you have there.  It probably won’t be nearly enough.

According to Canstar, 83% of people sign up for the default cover in their super account.  The amount of cover is typically low.  Superannuation statistics published by ASFA in December 2016 indicate that average super account balances in 2013-14 year were around $98,500 and $55,000 respectively for males and females.

This means that the average lump sum payout for a death or total & permanent disability insurance claim would be the equivalent of about one or two years of income at best.  And it won’t help at all to pay your way through the early years of a serious health trauma such as cancer, heart surgery or stroke.

If you think you can’t afford insurance, consider increasing your insurance in superannuation.  The premiums are automatically paid from your super account.  Although this will have a slowing effect on your retirement savings, it’s a compromise that can help a lot with the family budget, particularly during the expensive years of home making and child raising.

Call me direct on 0408 756 531 for a free appointment.  http://garyweigh.com

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Business management tips – risk insurance

9 myth-busters on personal insurance in Australia

Business management tipsYou hear it almost every night on TV.  Buy insurance direct and avoid the unwanted medicals.  Well here is the other side of the story – some business management tips, and tips for all individuals considering insurance.  When you purchase personal risk insurance through a licensed adviser, you will have a product recommended to you that suits your needs.  You will also have someone to explain the fine print to you, and to arrange everything for you.

So here is what really happens when you seek advice from an insurance adviser in Australia:

  1. Very few people are required to have a full medical for insurance purposes
  2. Most policies are accepted on the strength of your medical disclosure in the application and the report from your regular doctor (you agree to that in the initial application)
  3. You do not have to go to a doctor and pay for medical testing to get insurance
  4. If an insurance company wants you to undergo any medical test, they pay for it.  Because it is an expense to them, they try to keep all medical testing to a minimum
  5. Occasionally a blood test or other test is required.  If so, a registered nurse or other qualified professional from a specialist insurance medical testing service will arrange to see you at home or at work at a time convenient to you.  It takes 5 minutes.
  6. Most insurers have a tele-underwriting service where an underwriter will talk to you about your medical history over the phone in about 20 minutes.  You don’t spend hours filling in forms.
  7. If you apply for insurance that is personally underwritten, you will get a very competitive price because the insurer knows exactly the risk you represent to them.  You will also know up front what you are covered for and not covered for.
  8. Underwriting at application stage generally means that unless you fail to disclose information or you tell a lie, you are certain to be paid at claim time.  If you are not underwritten when you first apply, you may have the insurer asking these same questions when you make a claim.
  9. Insurance medical testing saves lives.  Many people have had their lives saved by finding out through an insurance requested blood test that they have a serious medical condition

Yes it is true that you will pay a fee to an adviser or the adviser will receive upfront and ongoing commission from the insurer.  It depends on the adviser however, every professional is entitled to be paid for what they do.  However, you will not necessarily save that cost by going direct, and you certainly won’t receive unbiased advice.

Personal risk insurance is must for business owners.  One final comment in this week’s business management tips:

“Ownership of an insurance policy is a crucial issue.  In the event of a claim, the money needs to be paid to where the protection is needed.  That could be to you the owner or your family; or to the business  (company or trust) if your business equity or a key person in your business is the subject of insurance protection.”

 

Make your superannuation commission free!!

Why pay an adviser you never see?

 

How much email marketing is too much?

This is something I wrestle with personally.  At the moment I am busy promoting my new online MyProsperityForum site.  My target market is risk insurance (i.e. life insurance & income protection) advisers, financial planners and home loan professionals.  I am also about to start a keyword and social media campaign to drive traffic directly to the site.

But back to the email issue!  I am emailing other financial professionals to let them know what a great resource this innovative forum is for them personally as well as the enormous benefits for their clients.

Whilst I don’t want to send emails too often, I do want them to know the benefits of using and referring their clients to the forum.  But how much is too much?

I am reasonably well known in the financial planning and business coaching Brisbane communities so I don’t want my emails relegated to the spam box.   That outcome will only serve to tarnish my good reputation.

But I do want to get my messages across.  For example:

  • Non-financial planning financial advisers are regularly asked questions outside their field of expertise.  MyProsperityForum is a perfect solution.
  • Some people, even clients of financial planners, are personal finance DIYs who are very interested in understanding the many tricky financial planning concepts as they apply to both individuals and business owners.  MyProsperityForum is the ideal solution and a service option not available or offered in the past
  • Many people can’t afford to or are reluctant to consult a financial planner.  Again, MyProsperityForum is a perfect solution
  • A lot of people simply want to ask questions of a knowledgeable professional without any obligation or product push.  There is also a lot of value at MyProsperityForum in seeing what other people ask.
  • People want difficult financial concepts (e.g. personal risk insurance, investment, superannuation, retirement, estate planning) explained in plain English.  MyProsperityForum already has such content uploaded in easy-to-read article form