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Ensure you have proper cover to avoid financial disaster in the new year

With the end of the year fast approaching, many consumers are so distracted with preparations for the festive season they unknowingly expose themselves to severe financial risk by forgetting to save adequately to pay for vital insurance cover.

This is according to John Marsden, National Sales Director at PPS, who says it is critical that consumers ensure they have sufficient funds to pay important premiums such as medical aid, life and disability cover, as well as motor and home insurance. “Throughout the year, many people are too busy to relook at their financial plans, so the festive season is an ideal time to do this. Failing to do so can result in severe financial consequences should something unforeseen happen to them, their loved ones or their assets during this period.”

Marsden says that with the increased risk of an accident occurring during this period, it is even more vital for all consumers to review their insurance cover  to ensure it is not only up-to-date but has also been paid on time.

“Firstly, there are more motorists on the road hastily trying to reach their holiday destination which increases the risk of a motor accident occurring. Sadly, the level of drinking and driving also tends to increase around this time of year due to festive parties being held, which places all motorists at greater risk of being involved an accident.”

Marsden says holiday makers who find themselves in new exciting locations are also more likely to partake in extreme sports, such as wind surfing, water skiing, paragliding, bungee jumping and mountain climbing, placing them at an increased risk of injury, disability or even death. “If someone is injured while on holiday and there is no medical aid cover in place they could find themselves with a hefty medical bill. In the worst case scenario, should the breadwinner of the family becoming disabled or die with no disability or life cover in place it could jeopardise the financial situation of the entire family.”

“It is important to speak to a qualified financial adviser, who can work out the right plan for someone’s circumstances, but a good rule of thumb is to have at least enough cover for your gross monthly income. In addition, one should also have between 5 to 10 times their annual earnings in life cover.”

He says that if consumers are not able to afford this premium, then they should take as much as they can reasonably afford and review their situation when it improves. “No one wants to think that something untoward will happen to them but in reality it does happen and it is crucial to have some plan in place than no plan at all.”

“Ensuring you have adequate funds for insurance cover will give you peace of mind in knowing that your family and assets are well protected, enabling you to relax and fully enjoy the festive season,” concludes Marsden.

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