So I just wanted to start a discussion about insurance, generally, and how to organise it all so you are getting the best value out of it.
To stimulate discussion, here are some questions:
What sort of insurances do you have?
Why do you think those sorts are worth having?
How have you arranged it so you are getting best value for your insurance dollar?
I'll start:
Health - we have top + extras health cover ever since I had to wait 6+ months of writhing around in pain to get my gallbladder removed. We have it through an industry provider and so we pay a lot less than on the open market, so we haven't traded off parts of it for a cheaper price.
Cars - this is one I'm not really that sure about, probably because we've never had cars that are worth very much. I'm never sure if we're really getting bang for our buck or if we should just go with the one that pays for the other party's expenses. On the other hand, the one time an idiot drove up the tail of our trailer, the insurance company paid our repairs and hunted him down and squeezed the $$ out of him, so maybe we're getting other value from being insured (ie, not just the money, but the lack of hassle).
Contents - we have this but it's a total stab in the dark cos I have no idea what a houseful of stuff is worth. It does have some good (but weird) extra elements like a little payout if you break a bone at home plus we have theft/loss/breakage coverage for some items away from home (eg laptop, phone, DH's bike, cameras, etc).
We own our home so we have building insurance (nb - we are insured for flood) but it doesn't seem to cost a huge amount so well worth it given the high stakes. Also, we have made sure it includes the demolishment costs, etc.
We don't have health insurance yet. It never seemed worth it because the cost outweighed what we were covered for, when we were able to afford treatments ourselves - especially with Medicare. However, now that we have two kids and DH turns 30 next weekend, we've started looking into it. It's been a bit overwhelming because I don't want to spend heaps and feel like if I take off some of the extras our luck will be so that that's what we need.
We have car insurance, even insurance over the motorbike that's worth only $1k. I don't care if it's stolen or damaged, but I do care if DH is at fault in an accident that causes damage, injury or death and I want to be covered for that.
W have home and contents insurance. The home insurance value is worked out with a calculator, you give the age of the house, size, what it's made of, etc etc and it works out the value. If our house was valued at $300k, it burned to the ground and cost $400k to rebuild, then that entire cost would be covered, it's not capped. The contents insurance was made a little easier by the fact that we were moving and had a good idea of what we had and the value, but we do need to revisit now that we have two kids with lots of stuff.
We've got landlord insurance, but we recently had old pipes break under the house, resulting in the ground swelling and the house lifting in the centre, cracking the walls. The repairs and loss of rent weren't covered because it was caused by "movement of the earth". Apparently it doesn't matter why the earth moved. So we paid $5,800 ourselves to fix it all and we're now looking into other companies.
We've got life, TPD, income replacement and trauma insurances. I believe these to be the most important of all our insurances. If things were tight I'd let the others lapse before these.
All insurances except the bike are through my work because I get a discount (they don't cover bikes). I believe though that if we shop around we'll be able to get a better deal elsewhere for the landlord insurance - something that actually covers repairs and stuff.
No health insurance - yet. I'm still umming and ahhing but I think its something that needs to happen soonish particularly as Im about to turn 30. I have no idea where to even start though.
Car Insurance - only the basic cover them if I'm at fault. I have access to other cars should mine be too damaged to drive away but I can't afford to fix someone elses out of pocket.
Contents Insurance - we only rent, so no need for building. But again I can't afford to replace our things should it all be gone tomorrow.
Life Insurance - Only recent with this one, but its something I thought about long and hard. Its for the kids really. They only have me on which they can rely financially and even if I'm not here to support them I want to know they will be taken care of and not struggle for anything. It should cover them until they finish school. After that they are on their own. Once they have left school I will also probably stop having it as well. Its really just for peace of mind while they are young.
Health insurance - if you're disciplined and can put money away against possible future need (and nothing major comes up in near term) then it's probably not worth it, based on what I've read. There are a couple of ifs, there, obviously.
Car insurance - it's probably worth getting covered if your car is reasonable high value. With our car, I got total cover. When we had a cheap, second car, I just had basic 3rd party cover. On previous cars that were only ever worth 2-5k, I only got this level of basic cover, because over a few years you easily pay the cost of a replacement car in premiums, otherwise.
Home & contents - definitely. It's better to be slightly overinsured for contents, I'm told (you get stung if it turns out you underinsured)
Life - reckon this is a good one, but need to read policy carefully to see what's covered and when.
On the whole, it's probably a good idea to talk with a financial planner. Which I've been meaning to do for several years now.... doh.
Health - just extras cover on me, had it since I was 18, so costs me very little for some basic coverage. Every time I look at adding the family, the cost can't be justifies due to what we would get back. I could put that money away for extras and come out in front. We considered it for major dental (looks like DD1 will need braces), but from what we could tell we would get very little towards that, so no where near enough to make it worth it.
Car insurance - full comprehensive both vehicles. Has been so worth it for us. Love the fact it get paid out or repaired and the insurer chases the other person. One car was reversed into whilst parked (thankfully witnessed) and the other was a complete write off
Home and contents - will always have these as well. The bank insists on home, so no choice there for now. We have unlimited rebuild, so whatever it costs to put a similar house back. Contents may not be enough, but honestly if we lost the lot and got a payout, then I would think carefully about what we replaced.
Life, TPD, Accident, Trauma - so important. Before my sister died, she said stuff health insurance, get life. They had health insurance, but due to her cancer should would have been treated anyway regardless. She had no life coverage though, not great when leaving behind a husband and 2 very young children. So whilst no health, the trauma will give a lump sum that could be used towards health expenses.
We just changed insurers after our landlords insurance went up by half as much again with no explanation except 'stamp duty increased 1.5%' WTF?! They weren't willing to budge, so we went elsewhere.
We've consolidated all ours - landlord, contents (for the house we're living in) and two cars. Saved a couple of hundred dollars. Could've been more if we'd split the cars, but the convenience factor won out
Car insurance is a must for us. If your cars aren't worth much and you're a safe driver (or maybe don't drive far) you could consider just CTP and putting the money you save on comprehensive insurance in an account for emergencies...better in your pocket and you might earn a little interest too
There are online calculators for contents insurance - we found insurers always overestimated the value of our stuff so insure for less than they suggest.
4Health insurance is a must here too - the cost of regular dental, chiro, physio, optical and hospital (pregnancy) means it's well worth it. I have also had bad public hospital experiences, so that clouds my judgement too, lol! DS has also started OT, so that's covered too. If I was in perfect health and finished having babies, we'd consider letting it lapse and again put the equivalent money in an account. By the time we'd need it, we'd have more than enough to cover any bills, even major dental or surgery. We try to make sure we get our money's worth by using what we can - no gap providers, plus there's extra for filling out a health survey and things like gym memberships can be covered too (still working on getting DH to join, lol!). Ours is through my work, and the cheapest we could get after shopping around.
Life insurance etc is something we don't have but have considered. With me not working, things would be dire if Anything happened to DH...but there is a benefit from his super. Not sure of the conditions to access it though...
Insurance - worth it?
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