I believe it greatly depends on personal situation (having mortgage or not, dependents or not, etc) and how much the person taking the insurance is comfortable with.
For a life insurance: one person may believe he/she needs only $ 500K, another person needs $1M coverage, another different person says $5M, while (I am taking a wild guess here ) a billionaire may want $xxx billion or nothing all because he/she/the family have more than enough safety net.
You need enough Death insurance to cover all your debts and some future costs such as private school education. 1.5 million is good I think the average is about $200,000 so there is a dramatic case of under insurance
You need enough Death insurance to cover all your debts and some future costs such as private school education. 1.5 million is good I think the average is about $200,000 so there is a dramatic case of under insurance
Life insurance and disability plus trauma insurance is essential IMHO.
Our whole family including the children are insured.
If something were to happen to me or my wife there would be sufficient funds to payout our entire portfolio.
Gives me sleep at night comfort that if something did happen to me on or off the job my wife and children would never have to be concerned about money again.
Some of our insurance premiums are paid out through our smsf making less dent in our cashflow.
My father has been on a disability pension since about 45 and is now sixty.
And although his cover has paid out his dept he explained that if he had of paid that little bit more he could of been very comfortable in life and wouldn't need to work a couple hours a week to pay for things he enjoys.
Most policies JMS don't include suicide or faking your death by hiding in the attic.
With many policies however your Financial Planner can dial back the premium for you by reducing his commission reflecting in a cheaper monthly premium without having to switch insurers.
We now do this on every new policy we write for clients or any policy we take over where they have an existing policy in place.
Many clients merely get us to manage the policy to reduce their monthly premium costs
If we can help a client save a few dollars then all well and good.
Realistically you wouldn't believe how many people are so under insured it is not funny.
Every time you take out a new loan or have a change in family circumstances you should really review your policy cover.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
I just renewed all of my insurances. I have Income Protection for 3 months to death, at 80% of my salary. 3 months to 24 months is in my super, and 24 months+ is via Macquarie Insurance.
For permanent injury / death, I have $750k lump sum, and a pension paid to my wife ~ $15k p.a + CPI for the rest of her life.
I have ~ $800k in loans, including one IP and our PPOR. So this should leave her in a relatively 'ok' state, by providing no mortgage and a yearly income (including rent) of about $35k. I don't want to be worth more dead than alive!
I just renewed all of my insurances. I have Income Protection for 3 months to death, at 80% of my salary. 3 months to 24 months is in my super, and 24 months+ is via Macquarie Insurance.
For permanent injury / death, I have $750k lump sum, and a pension paid to my wife ~ $15k p.a + CPI for the rest of her life.
I have ~ $800k in loans, including one IP and our PPOR. So this should leave her in a relatively 'ok' state, by providing no mortgage and a yearly income (including rent) of about $35k. I don't want to be worth more dead than alive!
I am sure her new husband will appreciate this!
Instead of paying your wife directly you could pay your estate and then divert it into a testamentary trust with certain controls to lessen the chance of any new spouse taking 'your' assets instead of them going to your children.
That's a good idea, we have child number 2 on the way and I haven't renewed my will since before child number 1 was born. At the moment everything goes to my wife, the whole I die, it goes it her, she remarries, then dies so it all goes to him does have me a bit worried about the future of my 2 children.
Thanks for the heads up.
PS. I'll check out all the links in your sig as well!
I just renewed all of my insurances. I have Income Protection for 3 months to death, at 80% of my salary. 3 months to 24 months is in my super, and 24 months+ is via Macquarie Insurance.
For permanent injury / death, I have $750k lump sum, and a pension paid to my wife ~ $15k p.a + CPI for the rest of her life.
I have ~ $800k in loans, including one IP and our PPOR. So this should leave her in a relatively 'ok' state, by providing no mortgage and a yearly income (including rent) of about $35k. I don't want to be worth more dead than alive!
Just correct me if I am wrong here, having multiple income protection ( i.e. months to 24 months is in my super, and 24 months+ is via Macquarie Insurance)…isn't it duplicating the process,….i understand both gives protection for different timeframe…..but who would cover you for first 24 months just your super?
Also, i guess you have ur injury insurance (TPD) outside of super….as in some super you'll still have to meet condition of release for this benefit to be paid out…..