Do I Need Life Insurance

We like to think ‘it will never happen to us’. But the reality is, some of us will pass on sooner than expected – leaving family and loved ones behind. Should misfortune occur, could your loved ones survive without you? How would they pay the monthly bills? Or keep up with mortgage repayments?

The risks
• On average, there is one death in Australia every three minutes and 36 seconds i.
• One in three women and one in four men will be diagnosed with a malignant cancer in their lifetime ii.
• Over 1,600 people die on Australian roads every year, most aged 26 - 59 years iii.
• Cardiovascular disease claims nearly 50,000 lives per year, representing 34% of all deaths iv.

The reality
Life Cover provides financial protection to those you care for most. Should the worst happen, it pays a lump sum benefit to your loved ones. Still, many Australians don’t take out insurance protection because of some common misconceptions.

“I have enough savings”
60% of families with dependents will run out of money within a year if the breadwinner dies v.

“ My Life Cover in my default super fund will suffice”
Life Cover inside super only represents 20% of the cover required vi.

“ It doesn’t matter; I’m not the main income earner”
Child care and home help provided by a ‘stay-at-home’ spouse could be worth more than $75,000 per year vii.

What is Life Cover?
Life Cover pays a lump sum amount in the event of your death – helping protect your loved ones’ lifestyle and future. It is essential for those with family or other financial commitments.

What do the payments protect?
Having the right level of cover helps ensure your family could survive without you. The benefit payment can be used to meet the following expenses.

• Mortgage repayments
Whatever happens, there will be funds available to safeguard the family home.

• Day-to-day expenses
Those everyday bills might not seem like too much of a burden, but they can really add up. Would your family be able to cover living expenses such as food, clothing and schooling without you?

• Children’s future
The cost of raising a family is significant. Life Cover can help ensure that your children have the schooling and upbringing you would want for them, if you weren’t around.

• Retirement protection
The lump sum payment means your loved ones’ retirement savings won’t be put in jeopardy.

• Funeral costs
Your family will be able to afford the significant cost of a funeral and the related expenses.

i ABS (2011) Population Clock, www.abs.gov.au/ausstats/abs, viewed 12 March 2012
ii AIHW (2008) Cancer in Australia: an overview 2008, Cancer series no. 46, Cat. no. CAN 42, Canberra
iii Australian Government (August 2008) Road Deaths Australia: 2007 Statistical Summary, Road safety report no.1,
Department of Infrastructure, Transport, Regional Development and Local Government, Canberra
iv AIHW (2011) Cardiovascular disease: Australian facts 2011, Cardiovascular disease series no. 35, Cat. no. CVD 53, Canberra
v IFSA (2005) A Nation Exposed: Investigating the Issue of Underinsurance in Australia, Research study commissioned by
IFSA and conducted by Rice Walker Actuaries and TNS Australia, Sydney
vi IFSA (2005) A Nation Exposed: Investigating the Issue of Underinsurance in Australia, Research study commissioned by IFSA
and conducted by Rice Walker Actuaries and TNS Australia, Sydney
vii IFSA (5 October 2005) Australian mothers – undervalued and underinsured, Media release, Sydney