Why Should I Have Insurance?
Sometimes things go pear-shaped. If an earthquake strikes, our house burns down, our car is in a crash or we fall ill, we might be faced with large costs that we can’t afford.
Someone long ago worked out that we could take cover from the storms by not having to take on all the risk by ourselves. We can help each other by spreading the risks among us as a group, and that’s what insurance does.
What insurance do I need?
We all probably need some kind of insurance, but not everyone needs all the different kinds.
How much insurance we need will depend on our own circumstances and attitudes. It’s easy to buy too much insurance. It’s just as easy to not buy enough.
When considering getting insurance we need to weigh up the risks of not having the insurance against the costs of buying it. Ask these three questions:
- What is the risk I would be insuring against? This could be death, a fire at home, or the car getting stolen. Or getting sick and not being able to work.
- What are the chances of it occurring? There’s probably a small risk of a fire in your home, but it will cost a lot if it happens. The chance of your car being damaged or stolen is much higher, but the costs probably won’t be as high as losing your home.
- What would happen? Would your family be able to pay for funeral and legal expenses in the event of your death, and how would they manage without your income? If there was a fire in your home, would you be able to replace the house (if you own it, that is) and all your possessions, or would you lose them completely?
If you can’t afford for something to happen, you should seriously consider taking out insurance.
Insurance is important when we’d be badly affected by a loss – even one that is not very likely to happen.
Your ability to earn is your greatest asset, losing this asset even for a short term can have long lasting financial consequences.
Sickness injury or disease, medium or long term can stop you from working for a long time. If you are not working you will have no income. Sickness can happen at any time, and without any warning. If you are sick and cannot work, how will you pay the mortgage or rent ? What about the monthly bills? How would you put food on the table?
On an income of $50,000 your lifetime earnings could easily exceed $2m while your major assets (house, contents and car) may only be a quarter of that. And, of course, you can’t maintain your lifestyle if you lose your income for any reason.
There is a 32% chance of a Male and 37% chance of a Female being unable to work for at least 6 months due to sickness or accident at some point during their working life
So…. “I’m healthy right now, I think I’ll get this insurance later” Are there any guarantee that you won’t get a sickness that prevents you from working for a period?
Ready to get Started?
For more information feel free to contact our Inurance Advisor, Shane Blummont.Contact Shane >
Published by Scott Miller
Today's announcement on Mortgage Holidays
With today’s announcement by the Finance Minister about 6-month mortgage holidays, we have been inundated by enquiries from our clients.
We are very thankful for everything you did. We will 100% recommend you to our friends/family and will return if we need future support.Nicole and Daniel Payne - 27 November 2018
Scott and Jo demystified the whole process and helped us buy our first investment property.Neil and Brigitte Glasson - 17 January 2017
Scott just helped us get a mortgage for the first time and was the most helpful out of all the professionals we dealt with, and gave the most useful advice.Mark and Stephanie Chin - 20th November 2015 - 20 November 2015