Protect your things
Updated: Jun 25, 2020
It's surprising how many people don't have insurance for their homes. Whether it's insurance for the building itself or for the contents inside - not having protection in place in case of fire, flood or theft can be disastrous on your financial wellbeing.
Then there are the others - those 'set-and-forgetters' who haven't reviewed their existing building and contents cover for years. You know who I'm talking about 😉
Some key points to consider
Those who have built a new home know that building insurance is part and parcel of obtaining a Certificate of Occupancy - without it, you can't move in. But this is a small section of overall homeowners and property investors. Some sources claim that around half of Australians don't have an insurance policy that fully covers their assets.
Think about that lovely mortgage you have - what happens if your home floods or it burns down without adequate insurance - or any insurance at all? Who wants to pay the mortgage off for a home they no longer own?
What if you're renting? The building insurance may not be your issue directly but your home contents are. Have you ever considered the costs of having to replace all your belongings - from furniture to footwear, knives and forks through to that new TV. There are calculators that even factor in if you are brand name and fashion-conscious because replacing your things would then cost more.
Underinsurance is not having sufficient insurance to cover the debt owed or the replacement value of the insured item. This can include the cost of repairing or replacing the building and/or the items in it. There are even some provisions in the insurance policies which will penalise the policy owner if they are underinsured in the event of a claim.
In some locations, the cost of insurance has skyrocketed due to flood zoning and fire events. How does the general public know what their options are and if the insurance they have are appropriate or price competitive?
You need a Specialist
When it comes to protecting your things - you need a licensed Specialist. A full-service Insurance Broker will search the market for the right cover at the best price for your situation. They're around to support you when it comes time to claim - not just a random operator in some call centre. These guys are amazing and take the complexity out of protecting your things and will search the market for the best price. If your current policy is still appropriate they'll advise you to retain it if it's in your best interest.
A word on your Financial Adviser
Your Financial Adviser is uniquely positioned to help you - they're like your personal Project Manager to help you have a better life in every area. They know your family, your health situation, your finances, your goals and objectives - they know you. It's not just about the products or services they specialise in but about how they can help you navigate the other important areas of your life also. They'll introduce you to the licensed Specialists that you need to build and protect your wealth - and for most Australians, the family home and investment properties are their major source of wealth.
Shaun O'Keefeis a fee-based financial planner serving the families of the Peregian community. He specialises in retirement planning advice, SMSF, superannuation and life insurance along with strategies for UK QROPS pension transfer and estate planning. His major focus is helping his clients set themselves up to build and successfully transfer their wealth between the generations. Subscribe