Author: Susanne Maas, Manager – Financial Advice, TAG Financial Services
Often when things get financially tight, people start reviewing their expenses. One such expense is personal insurance – life, total and permanent disability, trauma or critical illness and income protection (this cost can be a little hidden in the annual superannuation statement).
Although insurance is an easy expense to cut back on, you need to beware that it can cost you dearly in the long run and that it does provide a parachute when things go wrong. Here’s a message we recently received from a client:
In 2018, I sat down with Michelle Griffiths from TAG to review my personal insurances, and after weighing up her recommendations, I took out trauma insurance for the first time, recognising that I’m not quite as “bullet proof” as I once was….well we never know “what’s around the corner” because a couple of months ago, I was diagnosed with low-level, non-aggressive prostate cancer.
After getting over the initial shock, I contacted TAG, not really knowing whether my situation was serious enough to warrant a claim. Susanne Maas from TAG took complete ownership of my claim, sent me the relevant forms and submitted them on my behalf…within a couple of weeks, my claim was approved for the full amount insured, and the money was in my account. Whilst insurance premiums can be a drag, I now have quite a tidy sum available to invest or cover potential future medical expenses….a very pleasant silver lining to a difficult few months.
When reviewing insurance, we often find policies that have been in place for some time are no longer as competitive or offer fewer benefits. By having your insurance cover arranged by TAG, you will also have someone to stand by your side should there ever be the need to make a claim.
It does not cost more to get insurance through an adviser with a reputable insurer than if you go to the insurer directly. The Australian Prudential Regulatory Authority (APRA) issued a report in June 2019 showing that the percentage of successful claims where higher for policies acquired via an adviser.
If you are considering making changes, here are a few tips:
1. Talk through the options with your adviser. At TAG, this is complimentary and part of our annual service.
2. Have a full medical before you reduce or cancel cover. We have several examples where this has resulted in people changing their minds.
3. Look at your options to reduce cover rather than cancelling the lot.
4. Consider the average age for a claim, from one of Australia’s leading insurers:
– Death – age 57
– Trauma or Critical Illness – age 51
– Total and Permanent Disability – age 49
– Income Protection – age 46
If you have any questions, please contact Susanne Maas via email or call us on (03) 9886 0800.
Insurance Review
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Disclaimer: The information contained is general in nature. Professional advice should be sought before acting on any aspect on this page. Financial planning services provided by TAG Financial Advisors Pty Ltd (ABN 77 154 205 017 AFSL 415632), a wholly owned subsidiary of TAG Financial Services Pty Ltd (ABN 67 075 374 686). Copyright 2020. Please do not reproduce without the expressed written consent of the author.