More Myths About Life Insurance…
Myth # 7 – The cover in my super is enough
Over 70% of Australian life insurance policies – more than 13.5 million separate policies – are held through superannuation funds*.
While this cover is great to have, many of these policies only provide the minimum level of cover employers have to offer, which isn’t enough for most people.
In fact, Rice Warner* estimates that the median level of cover in superannuation meets is only 60% of needs for life cover (or just 38% for families with children), 13% for TPD cover and 17% for income protection.
Basic needs met by life insurance cover in super
*Insurance through superannuation, 2016, www.ricewarner.com/insurance-through-superannuation/
Myth # 8 – I’ll be covered by workers’ compensation
Workers’ compensation provides some protection for work-related accidents or injuries.
But it doesn’t cover most illnesses, nor does it cover anything that happens to you when you’re not at work. It’s worth checking your states workers compensation legislation https://www.safeworkaustralia.gov.au/workers-compensation.
Even if you are covered by workers compensation, the benefits are typically capped in terms of the amount and duration of payments, which means the cover could fall well short of what you really need.
Myth # 9 – Only the main breadwinner needs life insurance
There’s no doubt insuring the breadwinner is vital for any family’s financial security.
But if a non-working or lower income-earning partner became seriously ill or injured, their family would need a lot of assistance to replace their services within the home.
Imagine a breadwinner had to reduce their working hours to look after their partner or young children, or employ outside help.
Either option could prove very expensive, which is why both members of a couple should consider the various life insurance cover options available – regardless of their role.
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