Case Study(Insurance – Protecting a Hard-won Lifestyle)

Insurance - Protecting a Hard-won Lifestyle

Arthur is 55 and earns $120,000 a year as a sales representative. He is married to Fiona and they have three children aged 22, 19 and 17. The children have all finished school and the youngest is about to start university. Arthur is planning to retire at 65 and has $200,000 life insurance through his super.

Arthur has built a comfortable life and has a number of assets, including a lovely home and a fishing boat. He has no debts and retirement is still almost 10 years away, however it is important to Arthur that he remain able to maintain his current lifestyle should he become unable to work due to sickness or disability. He certainly would not want to sell any of his hard-earned assets or eat into his retirement savings to support his day-to-day living costs should anything unexpected happen.

After speaking to his financial adviser, Arthur takes out an extra $200,000 life cover with $200,000 total and permanent disability cover to pay for medical treatment and any alterations necessary to his house if he became totally and permanently disabled. He also decides to take out income protection insurance, selecting a benefit of $7,500 a month (75% of his current income) up to age 65. With these additions to his insurance cover, Arthur feels comfortable that he could retain his current lifestyle without eating into his assets should he be unable to work due to sickness or disability.

Disclaimer

These case studies are for illustrative purposes only. They are not to be taken as personal advice and are intended to provide general information only. They do not take into account your individual needs, objectives or personal circumstances. The information is based on Roe Financial’s understanding of the relevant Australian laws at 17 November 2011. You should assess whether the information is appropriate for you and consider talking to a financial adviser before making an investment decision. Past performance is no indication of future performance.

Information in this web page is based on regulatory requirements and laws, which may be subject to change. While care has been taken in the preparation of this document, no liability is accepted by Roe Financial, its related entities, agents and employees for any loss arising from reliance on this document.

This web page may contain general advice. It does not take account of your individual objectives, financial situation or needs. You should consider talking to a financial adviser before making a financial decision.

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