Life insurance: Why both partners should be insured
Life insurance is an essential part of planning for the future - your own and your loved ones. These days, it is becoming increasingly important that both partners in a relationship take out life insurance. Allianz Life Plan features three separate covers that can be taken out individually or in combination, so that if an insured person contracts a critical illness, becomes permanently unable to work or passes away, funds claimed from your insurance company can lessen financial and emotional stress. Listed below are some situations that promise much needed financial support if both partners of a household are insured.
If you both work
Over the decades, families in Australia have moved away from the traditional "nuclear" structure and in its place we have seen a rise in the number of families with dual incomesi. If both partners earn an income, life insurance should be taken out for each earner. Even if one partner earns significantly more than the other, both incomes contribute to the lifestyle of everyone at home and are therefore worth insuring.
If you own property together
Buying a property together is a significant commitment that usually means a large mortgage and a considerable repayment period that can be as long as 30 years. If you and your partner do own property together and are both contributing to the cost of the mortgage, each person should be covered by a life insurance policyii. It is important to consider what would happen if you or your partner could no longer generate an income, mortgage repayments continue and then will become the sole responsibility of the remaining partner. By ensuring that each partner is covered by life insurance, your debt repayments can be eased with the funds claimed from your insurance company.
If you have a family
If you and your partner have children, it is important to assess the real value of the contribution of both partners to the home, not just the financials. Regardless of whether both parents work, each has a valuable contribution to the home. A stay at home parent may take responsibility for the rearing of children, cooking, cleaning, or running household finances, if they were to contract a critical illness or pass away these duties would continue regardless. This responsibility would naturally fall to the breadwinning partner who may have to cut down working hours or pay for domestic help. Alternatively, if the breadwinner becomes critically ill, permanently unable to work, or passes away, the stay-at-home parent would most likely have to get a job so that they can earn an income for the family. During this difficult time, the home making and childcare duties would have to be taken on by hired help - and these fees can add up. Most nannies charge between $15-$20 per houriii and this will become a huge expenditure if you have to employ a nanny for after school care every day of the week. Taking out life insurance can help you significantly with expenditures like this.
Find out what Allianz Life Plan can do for you
If you are in a relationship or a have family, consider taking out life insurance for both partners. Allianz life insurance can help to protect your family from financial distress in the event of a critical illness, severe injury causing permanent unemployment, or death in the family.
Contact Allianz today to find out more about the three different covers, Life cover, Critical Illness cover and Permanently Unable to Work cover offered under the Allianz Life Plan for you and your partner.
i Pocock, B., 2001, The effect of long hours on family and community life, Adelaide University, Centre for Labour Research, www.actu.org.au/public/papers/pococklit/pococklit.pdf
iii Pay Scale Australia data, 2012, Hourly Rate for Nanny or Au Pair jobs, http://www.payscale.com/research/AU/Job=Nanny_or_Aupair/Hourly_Rate