There is no doubt that the very thought of claiming on your own insurance policy is depressing, but the research proves that you (or your partner) may be unable to work for an extended period during your working life due to sickness or an accident. The problem is that nobody has any idea of when that might happen. Please try to fight the urge to stop reading now and ‘worry about it later because there is an important message here.

It’s a confronting topic that makes us think about our own mortality. However, as a financial adviser I have helped many clients through the process. The worst can happen to anybody and in fact I have personal experience on the impact of sudden illness on my own family.

While I was at university I got a call from my mother to tell me that my father had had a heart attack and was in intensive care. This came as a complete shock: he was only 58 years old and as far as I was concerned one of the fittest people I knew.  He didn’t smoke and when he was younger had been a weightlifter, rower and lifesaver. He had only been to the doctor one week prior for his yearly physical where he was given a clean bill of health. Yet here he was, lying in intensive care with his whole world turned upside down. After being discharged from hospital he looked and acted like a man who had made a full recovery, and expected to return to work but, due to the physical nature of his job, he was forced to retire due to ill health.

For a proud man this was devastating. Like a lot of men of his generation he had very little superannuation and was not ready to retire both mentally and, in his mind, physically. 

Lucky for him however the superannuation fund that he was required to contribute to had income protection insurance attached. He was not even aware he had the cover. As a result, he was able to draw 75% of his income each month until he reached retirement age of 65. Every month without fail there was a cheque in the mail.  This allowed him to retire, invest what superannuation he had and not draw on that lump sum until he was 65. While he was initially gutted that he had to cease work, with my mum he spent the next seven years leading into retirement plus another 10 or more years after retirement traveling Australia in their caravan.

To this day he tells anyone who wants to listen how important it is to have income protection insurance. My mum and dad would have been financially ruined without it.

If something like this does happen to you, you want to make sure that:

i)              you took due care (supported by advice and help from someone in the know) when preparing your initial application, and

ii)             that you actually have the cover in place. The first question after, ”are you ok?” is often, ”do you have insurance?” If you think your answer would be, ”I think so” or  ”no”, please stop now and consider how your family would cope in this situation, or more to the point, how would you cope financially if something happened to a beloved family member?

Before you get to that point, where do you start if you don’t have cover?

Firstly, find a licensed financial adviser who specialises in insurance. I can help you here. The application process is so important to ensure a stress-free outcome in the event of a claim. It has to be done right; and the conditions and definitions (the boring stuff) must be spot on. Don’t be satisfied with approval of cover that required very little in the way of medicals or blood tests. You may think you have cover but it’s a nightmare to be told at claim time your application is rejected because you ‘broke the rules’ since you forgot (often genuinely) to tell the insurer something small but now seemingly crucial.

A professional adviser will ensure you have insurability from the very moment the cover is granted. Yes, you will have to pay for that advice, but believe me it’s invaluable. As I say, the last thing anyone wants when they have suffered a serious injury or have been diagnosed with a life-threatening illness is a delay.  Or worse still, have any doubt the claim will be paid.

This is where the role of an adviser throughout is so important. Your adviser will back you up and help you through the process. This alone is a huge benefit over buying insurance ‘online’, because who will be there to back you up?

So please don’t put it off another moment – and this is the pulling on the heart strings part – do it for those you love and who love you.

By: Conrad Gilbert

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