(Provided with permission by Tower Life Ltd)
"Cam's boss called to say there had been a storm and that the plane had lost control."
For Cameron and Holly raising a family was the ultimate goal in life. They had both always loved to be around kids and from the moment they met they were keen to start a family.
After they married they sold their apartment and bought a house with plenty of room for a big family. It wasn't long after that Mahrie came along, and by the time she was taking her first steps Holly was pregnant again, this time with a son, Oscar.
As is often the case with children, the years flew by too quickly and before they knew it Mahrie and Oscar were both at school. Holly chose to remain at home while the children were at primary school and Cameron continued to advance with the mining company. He was working as a sales manager earning $120,000 per annum but was increasingly away on business.
Cameron and Holly had often thought of doing something' about financial planning and bringing their insurances up to date but just wanted to 'get ahead a little more' before committing to any firm plan. Cameron was earning good money, but the monthly bills and paying a little extra off the mortgage always seemed to take priority over any longer term plans for financial security.
Then their world came crashing down
Cameron's boss called to say that there had been a terrible storm and that his charter plane had disappeared. The emotional impact for Holly and the children was devastating and it took some time for the reality of loss to sink in. The financial impact however, was very real from day one, with seemingly endless costs associated with Cameron's death and the stream of regular bills and accounts.
Without the financial safety net of insurance, Holly was faced with the prospect of selling their home or leaving her role as a full time care giver in order to find work. The love Cameron had for his family could not be translated into the secure lifestyle he had dreamed of providing for them.
What could they have done differently?
A suggested personal insurance strategy for Cameron and Holly prior to Cameron's accident might have included:
- Life insurance cover of at least $650,000 to extinguish the mortgage should either die prematurely. Additional requirements such as funeral expenses, ongoing income and education costs should also be considered.
- Total and permanent disability insurance equivalent to life insurance cover, so that if either were permanently disabled they could extinguish the mortgage. Additional requirements for refurbishments, ongoing medical expenses and home care should also be considered.
- Critical illness insurance to assist in mortgage repayments and the cost of medical treatment and time off work if either suffered a major medical condition such as cancer.
- An income protection plan of $7,500 per month for Cameron with benefit payments to age 65.
This information is of a general nature only and has been provided without taking account of your objectives, financial situation or needs. Because of this, we recommend you consider, with or without the assistance of a financial adviser, whether the information is appropriate in light of your particular needs and circumstances.
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