At a time of mass media, there is an abundance of stories and ads about the importance of insurance cover. But what happens when you’ve had your cover put in place?

With the pace of day to day life, there is a tendency for people to set and forget about their cover. However, it is imperative that your personal insurance policies are reviewed on a regular basis to ensure you’re adequately covered.

How do you know when it’s time to review your insurance policies?

There are several life stages and events, which should act as a trigger for you to review your insurance policies.  Whether it be more responsibility such as starting a family, buying a house or even stressful events such as divorce or the death of a family member; these events should be treated as a call to action to review your insurance policies.

Starting a family and/or buying a family home
Whether you are having your first child or buying your first home these are memorable moments of your life; with these milestones comes the desire to protect the things that are most important to you.  Personal insurance policies can often be complicated and may require lengthy amounts of time to put in force.  It’s a good idea to review and implement adequate insurance cover before life’s adventures occur.

Death of family members
With it is the loss of a loved one or someone close to you taking ill, it is in moments like these we consider our own mortality and what we can do to prepare for life’s unexpected eventualities.  Ask yourself, do I have adequate insurance in place if something was to happen to me?

Personal insurance cover should be reviewed but not limited to the following situations:

• Marriage or divorce
• Starting a family
• Buying a house
• New job
• Kids enrolling in a new school or completing their education
• Illness or death in the family

By being proactive you are fulfilling your wish to protect the people around you financially should something occur to you.

Case Study:

Jody is a 28-year-old working as a nurse and wants to provide funds to look after herself should something happen so she has implemented a Total & Permanent Disability (TPD) cover. This gives Jody peace of mind knowing that she has the cover the will support her in a difficult time.

Mark is a married 40-year old that needs to make sure income keeps coming in to provide for his living expenses if he can’t work. He worked with the JBS Financial team to assess his situation and has now implemented income protection cover. In our discussion with Mark, we discovered that Mark is a small business owner so not only is important to have the appropriate insurance in place to support his family but we also discussed Key Person insurance for the business.

Personal insurance is a complicated area and should be discussed with a financial adviser.  Reach out to the JBS Financial team to review your circumstances and to ensure adequate insurance cover is in place for you.

In August of last year, ASIC completed a review of the direct life insurance industry and revealed some startling statistics in their report (Report 587).

Direct Life Insurance is defined as being sold to consumers by insurers or their sales partners, by outbound telemarketing, inbound phone calls from consumers, online or face to face (through bank branches). These products are sold with general advice or no advice given meaning that the consumer’s circumstances are not taken into account.

The report revealed that:

– 1 in 5 of all policies taken out were cancelled in the cooling off period

– 1 in 4 of all policies that remained in force beyond the cooling off period were cancelled within 12 months

– 3 in 5 of all policies sold were cancelled within three years

– 15% of claims from direct life insurance are declined and 27% of claims are withdrawn

The average declination of claims across the entire industry is 7%, less than half of that compared to direct cover.

ASIC believe that these high rates of cancellations and claim declines is due to consumers being sold products they don’t want, can’t afford, or don’t perform as expected.

ASIC also found that consumers struggled with the sales experience and complexity of the products, and consumer understanding of key features is often poor. ASIC identified a failure by the salespeople to provide adequate information about important aspects of the cover, including key exclusions and future premium increases. It is hypothesised that this lack of understanding about the product resulted in the high cancellation and claim declines.

A 2015 report, Underinsurance in Australia, with data compiled by Rice Warner revealed that that median level of:

– Life insurance meets 61 per cent of basic needs

– Total and permanent disability insurance meets just 12 per cent of basic needs; and

– Income protection cover meets just 16 per cent basic needs

So not only are people cancelling their covers early, even if they do hold the policies for a long time, the insured amount is often quite low compared to what they require.

At JBS we know that insurance can be complex with often slight differences between policies, but you do not have to try and organise it on your own. As well as selecting the best product for you, we can also help determine the appropriate amount of cover required ensuring that all of our clients are properly insured to protect themselves and their families. Finally, in the event of a claim, we will also be there guiding you through the process making everything as painless as possible.

If you are worried about your insurance levels but are too scared or time poor to go at it alone and would rather seek the help of a professional, please contact our offices at 03 8677 0688.

– Liam Rutty –

When we’re young and free with the world at our feet, we think that we’re pretty indestructible (I remember that time). Life’s all about fun! Travel, drinking, friends… who wants to think about grown up things like insurance? While we might not want to think about it, it doesn’t stop that fact that we all need it.

Let me throw some figures at you… According to the place with all the info (The Australian Bureau of Statistics), they say that:
– In 2009, 15% of people in ‘prime working age’ are disabled.
– There are 275 new cases of diabetes in Australia every day, while two million of us are at risk.
– One in five Australians will experience a mental health problem in their lives.

And the Australian Institute of Health and Welfare put out a report that said:
– Males were 2.2 times more likely than females to be seriously injured as a result of a land transport accident, while just over 50% of those seriously injured were aged less than 30 years.
– For those seriously injured due to traffic (on-road) accidents, 28.2% were judged to be suffering from injuries which were considered to be high threat to life.

Of AMP’s 2010 claim, youngest to claim on Total & Permanent Disablement was just 18 years old, Terminal Illness was 24 years old, and Income Protection was 19 years old.

But what does that mean for you as a young nipper? Well, those figures don’t discriminate against age. We like to think that these figures are for the 15% of the older population or the two million people other than me.

But the reality is that it has to happen to someone, so it might be you. While we can take measures to reduce the risk, we can’t eliminate them and so we should look at ways of ensuring that other aspects of our lives are not negatively affected by it. Personal insurance gives you that freedom to know that if something did happen, you wouldn’t have to worry about the money needed to pay for rehab or maybe the cost of the experimental treatment, renovations to your home or even just having your partner or your parents stop work to be by your side in your recovery.

If we look at the statistics, you’re more likely to have a major medical injury or illness than win tattslotto but I bet you’ve bought a ticket or two in your life. If you think you’re in with a chance to win the big bucks, then you’re in with more of a chance to have something go really wrong with your health. So, why wouldn’t you take out insurance?

Also, taking out insurance while you’re young can save you thousands in the long run. While you’re young, you’re relatively healthy and therefore taking out insurance is cheaper. You are more likely to get standard rates, which means that you are no more of a risk of claiming than anyone else your age, unlike when you’re older, rounder and doing less exercise. If you can get standard rates at a young age, you can take out level premiums. This means that you can spread the risk of claiming over the life of the policy rather than just year by year and save a heap in the long run!

So take time out from all the stuff young people do these days and do a grown up thing for just a minute or two! Once it’s in place, you don’t have to think about it again (we’ll review it for you to make sure that it stays relevant) and you can go back to your Contiki tours, absinthe and ipads. Oh and it covers for anywhere in the world.

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