Personal Insurance - Minimise The Risks

Continuing yesterdays article "Minimise the risks by taking out insurance", let's talk about personal insurance.

Life 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

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.

Critical Illness Insurance

Critical illness insurance or Trauma Cover gets paid out if you are diagnosed with any of a range of serious illnesses including a heart attack, cancer or a stroke.

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

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.

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Published on December 12-st, 2009 in Life Insurance
Damon Rasheed is the CEO of Rate Detective, an Australian financial service comparison sites specialising in Life Insurance, Income Protection Insurance and home loans. Damon holds a Master's Degree in Economics from the University of Melbourne and has been involved in many start-up internet businesses.

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Important Information

Not all providers in the market are included in the comparison.

Any information or advice contained on this website is general in nature and has been prepared without taking into account your objectives, financial situation or needs.