The reasons we need to consider ‘Risk’
moneyGPS has reviewed the responses to the answers you provided and determined that it would be prudent for you to review your current insurance position. Why?
Unfortunately, risk is everywhere. We can’t completely eliminate risk, but we can reduce the financial impacts.
If you have any type of insurance, then you realise that the unexpected may happen.
You understand that risk (i.e., the possibility of suffering harm or loss) is a part of life and the financial impacts can be reduced by having insurance to cover you when things go wrong. That applies whether we are talking about your home, health, car … or more importantly for you!
It can also provide security to anyone who is your dependent, i.e., a person who depends on another person for support or assistance, particularly financial support. Losing the ability to earn an income is a huge risk that many people don’t consider. But being aware of this risk and minimizing it with insurance can give us peace of mind and a better night’s sleep.
Take a moment and consider your responses to the following questions.
| Situation | Y/N | Types of Personal Insurances and the ‘Risk’ they seek to cover. |
|---|---|---|
| Could you afford to pay your bills if you couldn’t work for six months? | Y/N | Income protection insurance; Income protection insurance covers a proportion of the income you lose because you can’t work due to injury or sickness. |
| Would your dependents be financially secure if you died suddenly? | Y/N | Life insurance; A set amount is paid when you die and goes to the people you nominate (your beneficiaries). |
| Could you afford medical care if you had an accident and suffered a total and permanent disability? | Y/N | TPD (Total or Permanent Disability) insurance; TPD insurance covers you in the event you become totally and permanently disabled and can’t work again. |
| Could your family manage financially if you were diagnosed with cancer and were unable to work for a couple of years? | Y/N | Trauma insurance; Trauma insurance covers you if you are diagnosed with a specified illness or injury that will make a significant impact on your life, such as malignant cancers, or strokes resulting in neurological deficit. Don’t think “it won’t happen to me”. |
