20 May 2009

Are you covered?

It has been a year of unexpected fires and floods. Victims and insurance companies alike report that many were either not insured at all or severely under insured. In light of these disasters, now is a very good time to reassess your insurance position.

When was the last time you looked at your insurance papers?

Do your renewal notices come in, get paid, filed and go unread? Many of us have our insurances on automatic payment, so there is no reminder for us to reassess our situation to make sure we are fully covered.

How well are you covered and what exactly are you insured for?

Mortgage Protection and Lender’s Mortgage Insurance

Mortgage Protection and Lender’s Mortgage Insurance (LMI) are for two different situations;

  • Lender’s Mortgage Insurance is usually required when your deposit is less than 20% of the purchase price of your property and protects the lender against the possibility of defaults on your repayments.
  • Mortgage Protection however is insurance that supports you in case you become involuntarily  unemployed or are unable to work due to illness or disability. Your mortgage is likely to be the biggest financial responsibility in your life time. It makes sense to ensure that you can continue to meet your commitment in the case of unforeseen events.

If you do not have this type of insurance please call the office immediately for a quote.

Home and Contents

It is estimated that 31% of homes in Australia are uninsured. Of those that have cover, up to 81% are underinsured, with an average cover of 70% (or less) of the actual rebuilding costs. Your home and contents insurance should provide adequate cover if you need to repair or replace your home (house/garage/shed) and contents in the event they are destroyed, damaged or stolen.

Motor Vehicle

There is a range of motor vehicle policies to cover different categories of vehicles (car, motor bike, caravan, boat and trailers) which need to be considered separately. Generally with motor vehicles, there are 3 main types of cover:

  • Comprehensive: covers your car, the other party’s car and damage to someone else’s property.
  • Third party property: does not cover your vehicle, it only covers damage to the third party’s property.
  • Third party fire and theft: covers damages to the third party’s property and also if your car is burnt out or stolen.

Income Protection

Income protection is well worth considering for everyone with an income. It is especially relevant to small business owners and the self employed. This insurance can pay you a predetermined percentage of your monthly income should you be unable to work due to illness or injury. There are many different types of income protection policies with a wide range of definitions and benefits available. Benefits are generally paid monthly and, depending on your insurer, can pay you up to 75% of your regular income. Did you know that the premiums for this type of insurance are also tax deductable?


Life insurance provides a lump sum payment to your beneficiaries in the event of your death. Generally this cover is considered essential to ensure that your family is protected and will have financial security in the event that you are not around to provide for them. If you are the main income earner in the family, this insurance will help your family manage their future (for example paying out mortgages, schooling and other family expenses) without your ongoing earning capacity.

TPD – Total and Permanent Disability

Total and permanent disability insurance (TPD) is usually an optional extra on a life insurance policy. It aims to provide a lump sum of money should you suffer an illness or injury which totally and permanently prevents you from working. This usually applies to any occupation for which you are reasonably suited by education, training and experience.

The payment could assist in maintaining your lifestyle, reduce the burden of high medical expenses, reduce or eliminate debt or perhaps provide money to modify your home to cope with the disability you have sustained.

When combined with life insurance, this cover can provide security for you and your family for the rest of your life.


Health insurance could be a topic on its own! There are many choices covering hospital and ‘extra’ options. Check the internet to compare the many varied alternatives available. Did you know that if you earn over $50,000 then it may actually be cheaper to have health insurance instead of paying the additional 1% Medicare levy?

As with any type of insurance cover, it always pays to do your research before making your decision.

Insurance Appraisal

Even if you think you have your insurances covered, it makes sense to regularly reassess your policies for peace of mind.

If you haven’t reviewed your insurances in the last two years, contact the office for information on how we may be able to help.

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