Insurance ABCs: Learn the basics
20 November 2018
This article is part of the Suncorp ESSI Money Family Challenge series, in partnership with the Financial Basics Foundation, an independent charity working to educate young people to better understand money and finances.
Risk is a part of everyday life – when things go wrong, it can be comforting to know that you’re covered and won’t suffer financial loss. This is where having insurance can help. Understanding different types and how they work is useful when it comes to choosing the right products for you and your family.
Types of insurance
There are a few broad categories that most insurance products fall under, no matter who you purchase a policy from. In these cases, you’ll often be covered for both damage to items you own and damage caused by other people. Common insurance types include:
- Car and vehicle: this isn’t just for cars, but can also cover motorbikes, caravans and boats.
- Home: to protect your property and its contents.
- Travel: for a range of risks, like cancelled flights, lost baggage or a cancelled trip.
- Pet: for a variety of things that could happen to your best furry friend, such as an ear infection or broken bones.
- Public Liability and Indemnity: to cover your business against personal injury claims or damaged property.
- Life and Income Protection: generally for your income and family, should something happen to your employment or you pass away.
- Consumer credit card: for loans and credit card repayments if you’re unable to pay them back because of disability or death.
This list is by no means exhaustive, but it gives you an idea of commonly insured items and situations.
For more detailed information – and some tips on how to take control of your insurance – download our factsheet.
Steps to take control of your insurance
It can be daunting trying to work out what type and amount of insurance you’ll need. Here are some things to consider before you make a purchase:
- Check the details and fine print of any policy you look at – policies cover pretty specific conditions, so you’ll want to make sure it’s going to suit your needs.
- Shop around with at least three different providers to get the best deal for what you need insured.
- Insurance isn’t like a bank account – the premiums you pay to your insurance provider cover you for what’s listed in your policy, so you can’t just withdraw money from your insurer like you do from your bank account.
- Pay attention to the exclusions – these outline events you won’t be covered for, so make sure you take note of these when choosing a policy.
- Get to know your Product Disclosure Statement (PDS) – this details what to do if you need to claim, and other contractual obligations for you and your insurer.
- Pay your premium – pay it on time, every time, otherwise you might be left uncovered.
- Review your policy regularly – this gives you the chance to see whether you’ve got the best deal.
- Take stock of your situation – look at all the risks and decide what you will and won’t accept so you can make the best informed decision.
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- How income protection can help you and your family in tough times
The Financial Basics Foundation is a non-for-profit charity focused on educating young people in money and personal finances. Their vision is, “that all young Australians are financially capable and can manage their finances now and into the future.” For more information visit financialbasics.org.au
This is general information only, current as at 20 November 2017 and is not legal or financial advice, nor is it intended to be legal advice or financial advice. It is not a recommendation or advice in relation to the Suncorp Group or any product or service offered by any company or entity in the Suncorp Group and does not take into account a person’s objectives, financial situation or needs. Before acting on this information you should consider the appropriateness of this information having regard to your personal objectives, financial situation or needs. The information is intended to be of a general nature only. We do not accept any legal responsibility for any loss incurred as a result of reliance upon it – please make your own enquiries.