The only certainty in life is that nothing is certain
Building wealth, improving business profits and minimising tax are three of the main advantages our advice can deliver for our clients. In addition to these important goals we are also very aware of the need for you to protect and secure the gains and assets already accumulated.
For this reason we recommend at Risk Management Health Check for all our clients to make sure they are aware of the options available and ensure they have the correct plan in place. 
What if you’re paying too much for insurance you may not need? Worse still would be finding out your coverage is woefully inadequate when you need to make a claim, putting your family and your home at risk.
We can’t guarantee you’ll never make a claim but we can help keep the pain to a minimum if you do.
Here are a few examples of how well thought out risk management strategies can work in your favour. Which one relates most closely to you?
Accidents? They can happen to you.
Stephen was a 40-year-old regional sales manager, married to Melissa and father to 3 year old Cameron.After dropping off Melissa and Cameron at a friend’s house one Saturday, Stephen was involved in a head-on collision with another motor vehicle. The outcome was a severe spinal injury which resulted in quadriplegia.
The injury meant that Stephen was unable to continue working as a regional sales manager or any other occupation for which he had prior training, education or experience.
The bills were piling up, loan repayments were due and on top of all these, there were medical equipment and home modifications that needed to be done in order to care for Stephen.
Fortunately, a meeting with his advisor when Cameron was born led to discussions about how to best prepare for the unexpected. Stephen had taken out a TPD insurance policy for a $500,000 amount insured, paid out as a lump sum in the event of a claim. This type of insurance is designed specifically for situations like this. With this money, Melissa and Stephen were able to pay off all their mortgage and personal loans, modify their home and purchase the necessary medical equipment to make life easier for him.
If bad news comes, why not be prepared.
Jenny was 36 years of age, employed as a clerk in local professional firm, when she developed severe abdominal pain. Jenny went to her doctor who recommended her having an ultrasound and undergo a laparoscopic procedure. When the results came back it was revealed that there was a presence of cancer in her right ovary. Due to this Jenny was unable to work and started treatment immediately.
The questions had to be asked – would Jenny be able to manage the stress if she had to return to work to pay her bills and living expenses while dealing with the treatment?
What Jenny needed was trauma insurance, which would help her pay for things such as:
- Specialised medical attention
- Specialised medical attention
- Modifications to her home if needed
- The relief from financial stress when recuperating
- Even a holiday to a quiet place at the end of her recovery
Luckily, after a review with her advisor some years earlier, Jenny had taken out a trauma policy with an amount of $200,000, which was paid as a lump sum after her diagnosis. With this money Jenny was able to pay off the mortgage on her unit, cover all her medical expenses and leave more than enough to take 12 months sabbatical from her work as she concentrated on her treatment and recuperation from the ordeal.
Written by Paul Toshack
Paul Toshack is a representative of Morse Financial Services Pty Ltd, AFSL No. 240689, ABN 61 003 485 742. The information contained herein is general in nature and not personal advice. It is based on our understanding of the current taxation and superannuation laws and is current as at 1 July 2009
