Continuing yesterdays article "Minimise the risks by taking out insurance", let's talk about personal insurance.
It is fair enough to say that the younger and healthier you are the cheaper your life insurance will be.
Life cover is essential for people with a family or dependants, who would not be able to survive without the main income and it gets paid out on death.
The figure that is recommended by Rice Warner Actuaries is that the policy should payout about 10 times your annual earnings.
Life cover can be obtained personally or through a group scheme such as your superannuation fund. It will definitely be worth checking with your super provider as premiums are often cheaper.
Most people have some sort of life cover through their super, but it is generally not enough. It would be less than 10 times recommended earnings so a level of top up cover is suggested.
Income protection insurance is for protecting your income, it covers you in the event of your being unable to work due to an illness or disability, it pays up to 75 per cent of your wage.
This is a very important type of cover as you are more than likely to get some form of illness before the age of 65.
Income protection cover is tax deductible so you can claim back an amount at your top tax rate.
The National Centre for Social and Economic Modelling maintain that 50 per cent of Australians over the age of 30 are likely to contract one of the seven main health conditions that lead to a long term disability.
Travel insurance is relatively cheap and easy to obtain for covering a range of holiday issues, including hospitalization, lost luggage, or travel documents and evacuation.
Should your holiday include dangerous activities such as skinning, climbing, or diving make sure that these are covered by your travel insurance policy.
Check out medical expenses cover in the US, as the cost of health care there is very expensive.
Also check out annual policies if you travel more than twice a year as these can be cheaper.