Personal insurance concepts – ‘Planning for the unexpected’

Planning for the unexpected

While you don’t like to think that something might happen to you, or your family, it is always better to be prepared for the unexpected.


Why prepare for the unexpected?

Think about the risks that you face in everyday life. There are risks that we can’t remove entirely. However, for a lot of risks that we can’t eliminate, we can mitigate their impact  by taking out suitable personal insurances.
















What are the risks?

If you don’t have adequate insurance, an unforeseen death or illness could have severe consequences for you or your family.

What would be the impact on your family if:

    • your income was to stop, or
    • you were unable to work for an extended period of time?


How would you pay your mortgage and meet your other living expenses, if you income was to cease?

You could struggle to make ends meet and run down your savings very quickly.

An umbrella can’t prevent the risk of rain, but it can minimise its impact

Did you know?

46% of Australians admit that they live ‘pay cheque to pay cheque’ including:

  • 1 in 4 households earning over $150,000 pa, and
  • 1 in 5 households earning over $200,000 pa. ¹
















1.Research conducted by IPSOS on behalf of MLC in August 2015 and published in February 2016 in ‘Australia today – Par 1: A look at lifestyle, financial security and retirement in Australia’.


Insurance Type Description Potential uses for insurance
Life (and Terminal Illness) Insurance Provides for a lump sum on death or diagnosis of a terminal illness. ·         Cover living expenses

·         Pay for childcare and housekeeping

·         Service or pay-off debts

·         Cover funeral and estate costs

Total and Permanent Disability (TPD) insurance Provides for a lump sum if you are totally and permanently disabled. Is often provided with life insurance. ·         Pay medical or rehabilitation costs

·         Cover living expenses

·         Pay for childcare and housekeeping

·         Service or pay-off debts

Critical Illness or Trauma Insurance Provides a lump sum if diagnosed with a range of specified critical or traumatic illnesses.
Income Protection insurance Pays up to 70%² of your pre-disability income, if you are temporarily unable to work due to sickness or injury. ·         Cover living expenses

·         Service debts

2. Income protection insurance taken out on or before 1 October 2021 will generally replace up to 75% of your pre-tax income.


Other key considerations

  • You may already have insurance through your employer or your super fund. Even if you have existing insurance, it’s always good to review what you currently have, to ensure that it’s adequate to meet your needs.
  • Everyone’s needs are different and the types and amounts of insurance that are appropriate for you may not be appropriate for someone else. It’s important that what you have in place is tailored to your needs, and that you review what you have on a regular basis, as your circumstances may change.
  • How much will it cost? There are a range of factors that influence the cost of insurance, including your age, gender, occupation, and your medical or family history. It may be cheaper than you think.


Seek advice

A Pinnacle financial adviser can help ensure you have the right insurances in place to protect your family’s lifestyle. The first step is having the conversation.

Your Pinnacle adviser can provide you with recommendations on what types and amounts of insurance cover you need to help make sure your family’s lifestyle is protected.


Source: Actuate Alliance Services Pty Ltd (member of the IOOF group of companies)