Callaghans, Create the Future
Published June 28, 2021

Change can happen in an instance.

People’s lives and personal circumstances can change in an instance. And if the unexpected were to happen, would those who are left behind be protected financially?

In Australia, studies have shown that when asked the question of ‘do you want your family to be financially worse off, better off or just as well off if something were to happen to you?’, there have been almost no cases that respondents answered ‘worse off’.

The need for Wealth Protection

Unfortunately, most people have not stopped to think about their Wealth Protection needs. Research have shown that when the financial burden is lifted off the shoulders of a recovering person, that person recovers faster and better.

What is Wealth Protection?

Wealth Protection provides an agreed benefit on the happening of an insured event.

Wealth Protection products can be used to protect the ability to reach financial goals by protecting against the above events. These products include:

  • Term life insurance – to insure against death.

  • Total and Permanent Disablement Insurance – to insure against TPD events.

  • Trauma Insurance – to insure against the major critical illnesses

  • Income protection Insurance – to insure against Inability to earn an income due to sickness and/or injury.

Direct V.S. Retail Insurance

Direct Insurance – At some point, you may have heard of ‘group’ life insurance which is an example of a direct insurance. Such insurance is not underwritten at the point in time that it was taken out, which means that your personal history and situation is not taken into account by the insurer and accepted by the insurer. This can likely lead to complications if such insurance covers go to claim. Moreover, you are not in control of the terms and conditions set by the insurer (which may change at any time) nor the level of cover.

Retail Insurance – The alternative to direct insurance is a retail insurance policy. Such policies are underwritten on application, which means that the insurer (the insurance company) and the insured (you) are bound by a contract. The individual will have much greater control over the policy and the insurer cannot alter any of the terms and conditions.


For further information, contact your Callaghans Financial Planning advisor.