Life and Risk Insurance
At TPWA we can help you establish the appropriate amount of life and risk insurance for your particular situation and that of your family.
While the need for life insurance may be obvious, the possibility of being unable to work due to accident or serious illness and the issues arising from this, need careful consideration.
You need to adequately insure, for the survival of your business if the unexpected happens.
For example loss of profit, the need to terminate staff, a decrease in supplier confidence and curtailing of credit, a reduction in bank overdraft or the inability to pay out a partner in the event of necessary early retirement.
The decision to have trauma insurance, perhaps in addition to income protection should be discussed with your adviser.
Each year a formal written review is conducted with each client and if your circumstances have changed by repayment of debt or the liability of children's education funding has reduced, then the life cover can be reduced. Alternatively the liability may have increased and your cover needs to be increased to compensate.
Life Insurance is about the future of your business, and your family.
Life and Risk Insurance - Personal
Life Insurance underwriting is based on personal information and personal medical information.
Life Insurance simply insures your life and when your life ends the estate or beneficiaries receive the benefits of the policies.
In Total and Permanent Disability Risk Insurance and in Crisis or Trauma Insurance you receive the benefits of the policy.
The benefits of Life Insurance for you:
- Life insurance can equalise the wealth distribution to the next generation
- Life insurance can provide a simple way of maintaining the core asset of the family wealth in an operational condition.
- Life insurance is a mechanism that can replace borrowings to fund preordained shares of family assets upon the death of the original asset creators.
If a major estate asset is not readily divisible (for example a farm or a real estate portfolio) there may be more than one beneficiary to make provision for.
An example of this is a farmer with a son and daughter.
If the plan is to leave the son on the farm what happens to the daughter? Selling the two back paddocks is obviously not realistic. Another situation where this may occur is in family businesses but could also happen if the estate owned something like a valuable art collection, or business franchises that are of considerably less value if split.
If the way to settle the wealth distribution to the next generation is to divide the estate assets, then there are a number of potential outcomes.
Failure of the business, CGT Liabilities, a family torn apart, contested will, loss of family control or an asset devalued - none of which are desirable.
Life insurance could take care of all beneficiaries, and avoid leaving behind a legal mess.
The cost of this cover in the context of the alternatives is not high. It could be looked upon as the price of servicing an asset.
Also some people may be in second marriages with young families to provide for in the event of death or total and permanent disablement.
- Life insurance to solve the dilemma of dividing the family assets
- Life insurance to cover debts
- Life Insurance to meet education aims and goals
- Life Insurance to replace income no longer generated
- Life Insurance to support your dependants
- Pays out debt and provides for your family
- Provides for lost income
- Enables joint goals for children to be fulfilled
- Meets life goals