February 2009
A friend of mine showed me videos of her New Zealand holiday. With no hesitation see threw herself over the edge of a bridge and straight into a free fall. My heart was beating rapidly. I watch the tiny figure fall further and further from sight until she gently skimmed the surface of the river and rapidly come back into view as her bungee cord contracted.
Suddenly her face was back on camera. Judging by the war cry, ecstatic face, heavy breathing and nearly visible adrenalin pumping through her veins the experience was exhilarating. The massive irony was this woman was my risk adviser. That is to say she sells life insurance.
I looked at her in disbelief. Surely risk insurance is the domain of the risk adverse. The type of person who enjoys grey cardigans, quiet indoor activities and slow drives listening to AM radio. These people would avoid extreme sports like the plague.
She could see my horror and said "If you’ll only try something when you are sure its right you won’t ever try new things". She then started to explain the types of risk insurance:
Income protection protects your lifestyle. Also known as salary continuance it usually pays a monthly benefit of up to 75% of your regular income if you’re too sick or injured to work. This type of insurance is great for paying the mortgage, children’s school fees, various bills and basically all of your day-to-day living expenses.
Total and permanent disablement cover provides a lump sum payment if you’re totally and permanently disabled. This cover can help you pay for medical expenses, repay major debts and help provide for your future.
Trauma cover provides a lump sum payment if you’re diagnosed with a specified ‘trauma’ condition. The types of conditions that trauma cover will cover you for include heart attack, multiple sclerosis, motor neurone disease, major organ transplant, severe burns, cancers, dementia, stroke or paralysis – to name a few. Trauma cover is designed to help cover your increased medical costs and living expenses, providing you some financial security during the important recovery process.
Death cover offers you the security that if the unexpected were to happen, at least your family won’t have to worry about money. Death cover works by making a lump sum payment to your family if you die. This sort of cover is helpful to people of all ages as especially if you have others relying on you financially or you have large debts such as a mortgage.
Naturally all insurance can be tailored and the cost is proportional to the amount of cover you take out. I was assured that my advisor had been sensible if some-what morbidly practical at least. She discussed her insurance cover with her partner before she went on her holiday. Though the holiday had been expensive, she told me that she was well insured. I decided that fun must be like insurance, the older you get the more it costs.
Evan Davis
