A risk management plan is a vital part of your financial strategy
A well-constructed risk management plan should consider the risks that can be avoided, the risks that can be accepted, the risks that can be outsourced, and the risks that can be insured. Using tools such as Trusts, SMSFs, and clever Estate Planning can often help reduce the cost of insurance and ensure all contingencies are covered. The goal of a holistic risk management plan is to ensure your wealth accumulation plan can continue efficiently, even in unforeseen or unfortunate circumstances.
Most people have insurance cover for their home, contents and motor vehicles as a matter of course, and most superannuation schemes provide some level of life insurance cover. However, few of us have properly considered the potentially devastating consequences of an unexpected injury, illness, disability or death in the family. These are the things that destroy most wealth accumulation plans. A good financial plan should consider Income Protection, Life, TPD, and Trauma insurances in light of the cost-benefit trade-off.