Uncover These Myths By Reading Good Life Insurance Articles

Copyright (c) 2014 Kerrie Peacock

If you don't read good life insurance articles, you're not likely to get the true picture of what coverage entails. Fortunately, you can easily uncover several myths concerning coverage, simply by reading well-researched articles on life insurance.

Here are some of the myths that you need to get rid of:

1. Singles Don't Need Coverage Because They Don't Have Dependants And Other Misconceptions

According to a 2012 CommInsure survey, young Australians and households with low income possess the highest underinsurance rates. Although, you may argue that young Australians are just starting out in life and they may not have sufficient funds to sustain regular premium payments, but that wouldn't present the true picture.

Indeed, the study went further to indentify the fact that majority of young and healthy Australians have the misconception that they cannot possibly be affected by any serious illnesses or injuries. Moreover, it's also likely that this group of young adults don't feel the need to buy coverage simply because they have no dependants.

The unfortunate thing about young people not getting coverage early is that they will have to pay higher premiums when they do seek coverage later in life. Obviously, the cost of insurance gets higher as you age and even more so if you develop various forms of health conditions or harmful lifestyle habits.

The best thing that you should do in those early years of your life is to purchase coverage that will give you more affordable premiums. Also ensure that your policy has the option of increasing coverage to cater for increased responsibilities brought on by family later in life.

2. My Default Life Coverage Is Enough

A shockingly large number of people are simply comfortable with the default life coverage they have within their super funds. This number of people constitutes 65% of Australians who possess life cover (based on the CommInsure survey). Sadly, such default levels of coverage are woefully insufficient for majority of them.

No, it isn't enough that you have coverage. You must also ensure that the amount for which you are covered is enough. Otherwise, there will be little difference between you and anyone else who had no insurance at all.

According to a 2014 report by the Financial Services Council (FSC) and MetLife, the recommended level of coverage should be ten times your household earnings. That is what will help pay for outstanding debts and cater for necessary expenses for your loved ones. However, if you wish your family to maintain their current lifestyle, you'll need to target coverage levels amounting to 15 times your household earnings.

3. Ignorance Is Bliss

The most surprising aspect of the 2014 survey by FSC and MetLife is the revelation that majority of Australians with life insurance (66%) simply have no idea of how much coverage they have. Perhaps this could be linked with the aspect of Australians settling for their default levels of cover in super funds, which represents a similar proportion (65%).

However, there is no excuse for you not finding out how much you are covered for, especially since this will provide vital financial protection that affects your family's livelihood when you pass on.


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Kerrie Peacock constantly reviews critical issues within the personal insurance industry in Australia. A great place to seek professional consultation on affordable life cover is MeCovered. You can visit http://www.mecovered.com.au/life-insurance-articles/ to help you select the best coverage.