Insurance

In terms of risk management one of the areas that is frequently overlooked is insurance. Insurance cover is never more important than when you have borrowing secured by way of mortgage against real estate. In general terms insurance should be taken out to cover the major income earner in a family in the event that they suffer death, disablement or trauma. The proceeds can be used to either pay out the borrowing/s or provide a source of cash flow to support the borrowing in the event of an accident.

Insurance takes a number of forms:

• Term Life
• Income protection
• Trauma insurance

Term life is just that….it provides an amount to be paid out in the event of death.

Income protection provides a regular payment in the event of an accident that renders a person unable to work.

Trauma insurance is a once off payment that is made in the event that a person suffers a defined event i.e. Heart Attack and is designed to assist in the recuperation process.

Insurance is a complex area and so take the time to discuss it with one of our Finance Consultants.