Studies show that most Australians are underinsured or not covered enough by life insurance.
According to the Global Insurance Market Trends published in 2015 by the Organisation for Economic Cooperation and Development (OECD), Australia (and Sydney) ranks 13th on Life Insurance Penetration Index among OECD member countries.
Meanwhile, LifeWise.org discovered that 83% of Australians have car insurance while only 31% have income protection. In addition, 50% of Industry Super Fund members are underinsured by $100,000 for life insurance.
This is alarming as no one really knows what could happen in the future. Getting a life insurance can ease some of the financial burden and help you ensure that you, your family, and your business can financially cope in case of any unfortunate event.
Top 3 Reasons Why Most Sydney People Don’t Have Life Insurance
There are three most common reasons why many Australians are not investing in life insurance: price, age, and work.
- Price – With the rising cost of living in Australia, families often prioritise their budget on food, mortgage, education, and utilities. Life insurance is perceived as expensive and unnecessary. But if you compare the cost, life insurance is actually among the most affordable insurance in the market compared to car insurance, home insurance, and private health insurance.
- Age – Many people who are in their 20s have this sense of immortality so they often take risks that could be debilitating if non-fatal. Based on a report published by the Australian Institute of Health and Welfare, 75% of fatal road accidents involved young men aged 17 to 24. Moreover, 63% of Australians aged 18 and above are already obese, which is a leading cause of critical illnesses later in life such as cardiovascular diseases. The primary advantage of getting a life insurance while you are still young is the lower premiums.
- Work – Many Australians are not getting life insurance because they are satisfied with the insurance offered as a perk on their jobs. Although this is commendable, your coverage may stop if you lose your job. Some schemes may offer you to convert the policy into a private plan, but it may incur you some cost. Also remember that the ideal face amount of your life insurance policy should be at least 10 times of your annual income, which may not be met by your work insurance as it may only carry a lower face amount.
Don’t Delay Life Insurance – Protect your family Today
If your savings is not enough to protect you and your family when you are gone, you need a life insurance. Consult a financial advisor today to learn what kind of life insurance you should own. If you want to secure your family against loss of income, maybe you need income protection insurance. But if your main concerns is to safeguard your family from paying taxes or from the loss of your business after you pass away, a whole life or universal life insurance might be suitable.
Working with a life insurance advisor from Focused Financial Advice will allow you to save time, money and effort. Our professional advisors can help you review your assets and figure out if you have enough coverage. We can tailor-fit your policy according to your financial priorities and within your budget.
Call Focused Financial Advice today at 02 9003 0611.