Is my health insurance enough? Author: Nicholas Kourouvanis Around half of all Australians have some form of private health insurance, with 47% insured for hospital and 55% for general treatment^[1]. Private health normally covers you for a range of medical expenses like hospital stays, doctors’ appointments, some prescriptions and maybe extras like optical, dental and physio. But is this enough? Will private health insurance supplement your income if you are sick and/or unable to work for a period of time? Would this cover your bills and expenses or service your mortgage? We often think the odds of something happening to us are pretty low, but statistics show that one in five Australians aged 21-64 will be injured, become ill or even die before they reach retirement^[2]. Let’s consider a recent client: Liam, aged 34, works as a carpenter. He has a family and mortgage with monthly interest. His wife works two days a week and cares for their two young children. Recently, Liam was injured playing football. His doctor says that after surgery he will be in a cast for one month and require rehab for at least another two months. This means three months out of work. Some of Liam’s medical expenses will be covered by his private health insurance but his loan repayments, household bills and childcare will not. Luckily, Liam had income protection insurance which covered 75% of his income after a 30 day waiting period. You may wish consider other types of insurance like:

• Trauma cover – provides with a lump sum payment if you’re diagnosed with a specified medical condition or serious injury, or undergo a medical procedure such as for a heart attack, major organ transplant, cancer or stroke
• Life insurance of death cover – Provides a lump sum payment to the people you nominate as beneficiaries if you die or become terminally ill.

If you are unsure if your insurance covers your needs, consult a financial planner for advice.   Note: This example is for illustrative purposes only. General Advice Disclosure: This document contains information that is general in nature. It does not take into account the objectives, financial situation or needs of any particular person. You need to consider your financial situation and needs before making any decisions based on this information. If you decide to purchase or vary a financial product, your financial adviser, AMP Financial Planning and other companies within the AMP Group may receive fees and other benefits. The fees will be a dollar amount and/or a percentage of either the premium you pay or the value of your investment. Please contact us if you want more information. ^[1] Private Health Insurance Quarterly Statistics, APRA, March 2016 (issued 17 May 2016), page 3 http://www.apra.gov.au/PHI/Publications/Documents/1605-QSR-20160331.pdf ^[2] https://www.finder.com.au/underinsurance-in-australia