For many people, one of the most important roles in life is parenthood, but as an “unpaid” occupation, can a full-time Mum or Dad insure against the costs of not being able to fulfil their role if they become sick or injured?
The short answer is yes; but another more difficult question to answer is, how do you place a value on looking after the family and managing the home?
Total and Permanent Disablement (TPD) insurance covers the risk of a person not being able to work due to total and permanent sickness or injury. TPD definitions have traditionally been explained as not being able to work in your “own occupation”, which means you will be covered if you are unable to return to the work of your choice; or “any occupation”, which will pay a benefit if you are unable to return to any type of employment based on your education and experience.
A policy on a full-time “Homemaker”, will, in general terms, pay a lump sum if the insured person is unable to perform domestic duties and child rearing, or engage in any employment due to total and permanent disablement. This money could be used in any number of ways including paying for outside assistance to manage the home, covering medical costs, or paying off or reducing a mortgage.
It is important to be aware that the definitions used by various insurance providers for the types of cover, and what constitutes “home duties”, are not all the same. There may also be additional requirements and specifications under these types of policies.
Before you choose any personal insurance cover, always seek professional advice from a licensed financial planner to ensure it will meet your family’s particular circumstances should the need ever arise.