Financial protection is taking prominence for property owners as a result of new alarming statistics, according to Smartline Personal Mortgage Advisers.
Despite the majority of investors taking out property insurance, it appears that Australian’s are four times more likely to lose their homes as a result of death of a family member than fire, and 38 more times likely to lose it due to an accident or illness.
“While many may believe that the loss of the family home is due to interest rate rises and financial over-commitment, in fact the main reason people are forced to sell their home is as a result of illness, injury or death,” Smartline’s executive director, Joe Sirianni, said.
More than three quarters of Australians will contract a “serious illness” during their working lives.
Mr Sirianni said that this points to new insurance considerations.
“People will take out home and contents insurance to protect their new home, but don’t take out insurance to protect their very ability to be able to pay the mortgage that allows them to have that new home,” he said.
“Buying a property and taking on a mortgage is a significant life event with a high level of financial commitment, so it’s critical to look at protecting your financial position, so that if anything happens to you, your family can keep their home and manage financially.”
Income protection, trauma insurance, total and permanent disability insurance and life cover are some considerations for investors.
“It’s important to take a holistic approach to your entire financial situation, and this includes ensuring you put appropriate insurances in place to protect you and your family should the worst happen.”