Have you made a future plan for your family in the event of your passing? No? You’re not alone.
According to a new survey conducted by life insurance comparison site LifeInsuranceFinder.com.au, 32.5 percent of Australians have not considered putting together a financial plan for their family in the event of their death.
Surprisingly, it takes the shocking loss of a family member or friend before one in two people considers taking out life insurance cover.
Major life events also play a significant role. For example, 23.16 percent of Australians would be influenced by marriage or the birth of their first child.
Interestingly, 35.59 percent of respondents were more likely to purchase life insurance when taking out a new mortgage than when having a child.
When should you consider taking out cover? Here are some suggestions from Fred Schebesta, the publisher of the comparison website:
- Getting married – life cover can ensure that spouses will not suffer any financial hardship if one party were to pass away.
- Having children – Australians should consider the various expenses that may arise while children are still dependent, such as food, clothes and education. To ensure an adequate level of cover is in place, it is important to review the current level of cover as the family grows.
- New home or mortgage - a first home purchase is often the biggest financial commitment of one’s life. It is crucial to ensure the right cover is in place so that friends and family are not left under financial strain.
- Single with no kids – Australians may still want to consider cover for any debt accumulated or to cover funeral expenses so they are not passed onto family. It may be necessary to consider Trauma Cover or Income Protection to have a financial safety net in place if forced out of work due to serious illness or injury.
- The earlier the better – it’s worth considering taking out cover earlier in life to take advantage of more competitive premiums. It is ideal to take out cover when in good health. Most policies will allow applicants to increase their level of cover without having to undertake further medical testing.
Schebesta said: “Taking out a life insurance policy doesn’t require huge sacrifices and the benefits of being covered, far outweigh the costly risk of not doing so.”
“Taking the time to compare the hundreds of different policy options available and weeding out unnecessary and expensive extras can save thousands of dollars. Death, serious illness and injury can be sudden and unexpected and Australians shouldn’t wait until it’s too late before they consider the value of life insurance.”