Be wise, be protected against the risk of unforeseen life events

*This content is brought to you by Carrick Wealth, leaders in wealth and capital management

Two unpleasant issues that most of us like to avoid thinking about, are death and critical or debilitating illness, with resultant potentially disastrous consequences for our continued financial wellbeing and welfare of our families. However, with good financial planning and investing in the appropriate risk cover, the negative financial consequences so often associated with such events, can and should be avoided.

If you need further convincing about the importance of such cover, consider the research findings of local insurer FMI, based on their claim statistics. They found that 7 out of 10 people will have at least one injury or illness that will prevent them from earning an income before the age of 65, either temporarily or permanently.

In order to help financial advisers and their clients to better plan for their futures and prepare for unplanned events, Liberty Life earlier this year released its annual statistics in respect of claim payments for the various possible life events during the preceding year. The major part, some R3.24bn in claim payments, was for life cover following death. An amount of R691-million was paid in respect of lifestyle adjustments required following a critical illness diagnosis or treatment, while just more than R525-million was paid for loss of income protection.

Liberty’s research also found that cancer affecting all age and social groups remains the leading cause of claims, followed by cardiac and cardiovascular conditions, while strokes or central nervous system disorders also contributed significantly to total claims paid. Significant too was the high percentages of millennials and young parents that were affected. These statistics tell their own story.

Appropriate risk cover

Apart from cancer or heart attack, critical illness can also include a range of other conditions such as stroke, organ failure or paralysis. Even if you recover from a critical illness event, it could still have a seriously adverse impact on your financial situation and planning. Taking out appropriate risk cover would be a wise precautionary step to afford you and your hard-earned wealth protection against such an eventuality.

Read also: The vital importance of having an up-to-date Will

Equally, if you are unable to work or earn an income following such an illness, having income protection will not only provide you with income to help you maintain your lifestyle and meet all your expenses, it will also ensure that your retirement planning is not affected and that your emergency savings are not eroded. And adequate life cover will ensure that your family is financially protected should something happen to you.

“Having a long-term financial plan that excludes protective cover against critical illness, disability, loss of income and death, makes no sense at all. Because any of these could sneak up on any of us at any moment, bringing with it ruinous financial costs, loss of income or could even wipe out one’s life’s savings unless we are protected adequately. It could also leave your loved ones in dire financial straits,” says Paul de Waal, Director Wealth Management and Advisory.

Carrick recommends that everyone should review their cover regularly to ensure it remains aligned with their needs in the face of potential risks.  If you wish to review your existing cover or have no risk cover at all, you can contact us at wealthmanagement@carrickfs.com for a consultation today.

• Carrick Wealth is a registered South African financial services provider specialising in South African and international financial planning and integrated wealth management solutions. Carrick is also licensed in Zimbabwe, Botswana and Malawi, and holds three global licences in Mauritius. Carrick at all times maintains its independence with regard to product providers and asset managers, providing bespoke risk assessment, financial planning and other services to high net worth individuals (HNWI). Through our own qualified and experienced wealth specialists, as well as through partnerships with industry leaders in the fields of foreign exchange, tax, international property, offshore bank accounts, trusts, wills and estate planning, Carrick is able to provide the highest levels of service for your financial planning and investment requirements, both offshore and domestic. This communication is intended solely for information purposes for the use of designated recipients and is not an offer, recommendation or solicitation to transact. While it is based on information available to the public and from sources believed to be reliable, Carrick makes no representation that it is accurate or complete or that any returns indicated will be achieved.