Understanding Life Insurance

People’s lives and personal circumstances can change in an instant. If the unexpected were to happen, would those who are left behind be protected financially?

The risks 

  • On average, there is one death in Australia every three minutes and 36 seconds [1]
  • One in three women and one in four men will be diagnosed with malignant cancer in their lifetime [2]
  • Over 1,600 people die on Australian roads every year, most aged 26 – 59 years [3]
  • Cardiovascular disease claims nearly 50,000 lives per year, representing 34% of all deaths [4]

What is life cover?

Life cover pays a lump sum amount in the event of your death – helping protect your loved ones’ lifestyle and future. It is essential for those with family or other financial commitments.

What do the payments protect?

Having the right level of cover helps ensure your family could survive without you. The benefit payment can be used to meet the following expenses:

  • Mortgage repayments
  • Day-to-day expenses
  • Children’s future expenses
  • Funeral expenses

Michael’s Story

Michael (28) recently took out a Life Insurance policy.  His father had died suddenly at age 46 from a heart attack when Michael was just 16, leaving his mother to support him and his younger siblings.  It was their father’s foresight to take out life insurance that helped the family survive this tragic event.  The lump sum payment ensured that money was the least of their worries. The day after Michael’s wife, Susan, announced she was pregnant with their first child, Michael spoke with his financial adviser about choosing the right kind of insurance.  The life cover he took out means that if the worst does happen, Susan and his future children will have the same financial security that Michael experienced after the loss of his father. His adviser also mentioned the option that they consider Child Cover when their child turns two years old.  This would mean that if their toddler became ill in the future, they would be able to focus their energies where they were needed – on their child not the finances.  Source – CommInsure Claims.

How can a financial adviser help?

No one plans to get sick, injured or to die prematurely, but you can take the opportunity right now to explore your options and make a conscious choice about your future, rather than leaving it to chance. Through effective planning and provision for events that threaten your life, you can safeguard the financial future for you and your family today. Putting your plan together is best accomplished with the help of a Risk Insurance Specialist. It may be the most significant step toward financial freedom you ever take.

[1] ABS (2011) Population Clock, www.abs.gov.au/ausstats/abs, viewed 12 March 2012

[2] AIHW (2008) Cancer in Australia: an overview 2008, Cancer series no. 46, Cat. no. CAN 42, Canberra

[3] Australian Government (August 2008) Road Deaths Australia: 2007 Statistical Summary, Road safety report no.1, Department of Infrastructure, Transport, Regional Development and Local Government, Canberra

[4] AIHW (2011) Cardiovascular disease: Australian facts 2011, Cardiovascular disease series no. 35, Cat. no. CVD 53, Canberra


The information contained on this website is for general information only and should not be relied upon unless you first discuss your circumstances with a Licenced Financial Planner.

The Authorised Representative of Alea Insurance Pty Ltd ACN 107 647 192 is Steve Wilson (AFSL No: 331367) who is licensed by ClearView Financial Advice Pty Ltd ACN 133 593 012.