I met with a young couple who wanted to buy a home once.

They were in their early 30’s with 3 kids all under 5 years old

Mum stayed at home, and dad worked in a sawmill.

Dad was a big fit guy, played rugby and loved his family.

After I had arranged their home loan, we got onto talking about Life insurance.

With one income, 3 kids and a mortgage to pay, there were hesitant about the cost of life insurance initially, however recognised it was probably the next bit of ‘Adulting’ they had to do.

I set up an insurance policy which consisted of Life insurance and Trauma insurance.

The Life insurance was sufficient to repay the mortgage in case one of them passed away early or had a terminal illness, plus a bit extra for funeral and a bit more for the family’s future.

They also took out some Trauma insurance, so that if either of them had a major health issue and couldn’t work or take care of the kids, there was some extra money in the bank.

Now with people in their mid 30’s, its not likely that one of these events would occur, and they presented as low risk of anything happening to them.

After about 6 months of the policy being put in place, I received a phone call from them.

They told me that one morning, dad got up and went to the toilet, and noticed that there was some blood in the toilet when he had finished.

It happened a few days in a row. He went and saw the doctor to get checked out. The doctor sent him away for some blood tests. They came back and the doctor referred him to a specialist who did more tests. The diagnosis, bowel cancer.

Not only bowel cancer, but one that had rapidly developed.

He started down the path of treatment, however it had advanced fairly rapidly, and the prognosis was that he was diagnosed as terminally ill, and not expected to live for a year.

I was shocked that this could happen to someone so young.

I won’t go into specifics about the administration we went through, however we were successful in making a claim on his Life Insurance policy, under the Terminal Illness benefit.

The money they received was put towards what they intended it for. Repay the mortgage and have some left over.

With the left-over money, they decided to take a family holiday before dad ‘s health deteriorated further. Dad stopped work and spent the time with his family and created some memories with them.

The life insurance enabled them to do this.

Since then, I’ve made it a point to bring this conversation up with everyone I can.

I never know what will happen and would never forgive myself if I didn’t bring it up and then something happened to them.

When I do, I usually get some pushback on how much it costs, especially from young families. I expect it every time, and surprised when I don’t receive the pushback.

When I was that age, I also had the attitude that this wouldn’t happen to me, it happens to other people but not me, and I’d prefer to have some spare money in my weekly budget. So, I totally get where they are coming from.

So, what I do is I tell this story - and let them reconsider.

If you think about insurances, and how much you pay in premiums, have you thought about what the financial impact would be to you, and how you could financially recover from an unexpected event?

If you have a car worth $15k or so, sure if you crash it may cost money to fix, or if it can’t be fixed, you can always go and get another car. As long as you are working and earning money. However, if something happens to your health, impacting your ability to go out and earn money, what happens then?

Getting a loan will be tough as banks need to see your source of income and make sure you can afford the repayments.

So I suggest that although a low risk, it’s worth having… just in case.