Do you know who gets your super when you die?
For many Australians, superannuation is their greatest asset outside the family home. But do you have a plan for who will receive your super if something happens to you?
When you think about building wealth, you may picture investments, property and superannuation. But there’s another critical element: insurance. It’s the silent partner in your financial strategy, quietly working behind the scenes to protect everything you’ve built.
Strategic asset allocation is the hallmark of a robust wealth plan, using diverse holdings to build long-term financial success. Yet, defending a portfolio against unforeseen events and ensuring a smooth estate transfer is just as vital. That’s where targeted insurance solutions come in.
Far from being just a safety net, insurance can be a tool that preserves your assets and keeps your plans on track even when life delivers the unexpected.
Insurance can help to create a more resilient wealth plan, especially for those with complex estate considerations. In other words, the right cover can make all the difference between maintaining your lifestyle and facing financial hardship.
The role of risk insurance in your financial plan – [Fact Sheet]
Life is unpredictable. Illness, injury or premature death can derail even the most carefully designed financial plan.
The risk is magnified if wealth is concentrated in illiquid assets such as private business interests or large property holdings. Beneficiaries often need immediate access to cash to cover any outstanding debts, taxes that may be owing, and to manage business continuity. If funds are not available, the executor may be forced to sell the core portfolio, or business assets quickly, and potentially at a loss.
That’s where life insurance, Total and Permanent Disability (TPD) cover and trauma insurance can play an important role as a structural defence mechanism for a portfolio and an estate.
Life insurance provides a lump sum to beneficiaries after your death, allowing them to secure their future. TPD cover steps in if you suffer a permanent disability and are unable work again, providing the funds for medical care and living expenses. Trauma insurance covers serious illness such as cancer or heart disease, giving you financial breathing room during recovery.
Income protection insurance is another valuable way of providing income if illness or injury stops you from working. It pays up to 75 per cent of your income and helps you to avoid dipping into your savings or selling assets at the wrong time.i These policies can mean peace of mind for families, helping to protect assets and ensuring that wealth transfers happen as you intended.
Insurance is also a cornerstone of small business risk management strategy.
Assessing and managing risks may highlight the need for a range of insurances such as flood and fire, theft, public liability, professional indemnity and cyber liability. These covers can help to defend your business against the crippling expenses that may follow unexpected events.
Business partners can use life insurance policies to safeguard their interests in case one business partner dies, providing the funds to buy the partner’s share of the business from their estate. Without a policy, the surviving partner may struggle to buy out the deceased’s share, forcing a quick sale of the business at a discount. With the right cover, the transition can be smoother, preserving value for the families involved.
Meanwhile, key person cover helps to protect against the financial impact of losing a vital team member to illness or if they die. In the event of a claim, the business will receive the insurance benefit.
As life changes, so should your insurance. Too little cover in any area of your life could leave you exposed, too much could mean unnecessary premiums. Regular reviews can ensure your various insurances fit with your goals and current circumstances. It’s about having the right cover at the right time.
Insurance doesn’t generate returns, but it protects the foundation of everything you’ve built. Without it, one unexpected event could unravel years of planning. A few smart decisions now can make all the difference when life doesn’t go according to plan.
Please call us to talk about how your current cover fits with your financial strategy.
This article is general in nature and has not been tailored to individual circumstances. Before acting on this information, you should assess your own circumstances or seek personal advice from a licensed financial adviser. This article is current as at the date of issue but may be subject to change or be superseded by future publications. While it is believed that the information is accurate and reliable, the accuracy of that information is not guaranteed in any way. Past performance is not a reliable indicator of future performance, and it should not be relied on for any investment decision. Whilst care has been taken in preparing the content, no liability is accepted by the Licensee nor any of its agents, employees or related bodies corporate for any errors or omissions in this publication, and/or losses or liabilities arising from any reliance on this information.
For many Australians, superannuation is their greatest asset outside the family home. But do you have a plan for who will receive your super if something happens to you?
The income assumptions many have carried into retirement are being tested in the current economic climate.
Certe is part of the AZNGA Group. General Advice Warning: The information provided on this webpage is intended to provide general information only and the information has been prepared without taking into account any particular person’s objectives, financial situation or needs. Before acting on such information, you should consider the appropriateness of the information having regard to your personal objectives, financial situation or needs. Certe Wealth Protection Pty Ltd (ABN: 31 150 270 278) is a Corporate Authorised Representative of Fortnum Private Wealth Ltd ABN 54 139 889 535 AFSL 357306.
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