Check your life as­sur­ance cover

Weekend Argus (Saturday Edition) - - PERSONAL FINANCE -

Your life cover needs may be in­creas­ing or de­creas­ing, de­pend­ing on how old you are.

If you are near to re­tire­ment, have paid off a sub­stan­tial por­tion of your home loan and/or your chil­dren are reach­ing fi­nan­cial in­de­pen­dence, you may need less life and dis­abil­ity cover than pre­vi­ously.

Redi­rect­ing your pre­mi­ums into, for ex­am­ple, sav­ing for re­tire­ment may be a wise thing to do.

If, how­ever, you are younger and have a grow­ing fam­ily, your life cover needs may have in­creased, be­cause you have more de­pen­dants for whom to pro­vide if you die pre­ma­turely.

Ev­ery work­ing per­son should re­view their dis­abil­ity cover and in­come pro­tec­tion an­nu­ally.

If your salary has in­creased, you may need to in­crease the amount of in­come pro­tec­tion you have.

Many poli­cies have an au­to­matic in­crease in the amount for which you are cov­ered to en­sure that your pol­icy keeps pace with inflation, but if inflation has out­stripped the in­creases on your pol­icy or you have had an in­crease as a re­sult of a pro­mo­tion or a change in jobs, you may need to ad­just your pol­icy.

If you have in­come pro­tec­tion through a group life pol­icy, check that it is suf­fi­cient for your needs. Group poli­cies may have re­stric­tions on the max­i­mum amount of cover you can buy, the def­i­ni­tions of dis­abil­ity may be nar­row and/or there may be re­stric­tions on the amount by which the cover can es­ca­late.

A prop­erly qual­i­fied fi­nan­cial plan­ner should be able to help you de­ter­mine whether your life, dis­abil­ity and in­come pro­tec­tion cover are ad­e­quate.

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