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Blinded by optimism

 

We’re designed to believe bad things won’t happen but it pays to think clearly and put plans in place, ahead of time. 

 

 

Behavioural science reveals that it’s in our nature to believe bad things won’t happen to us in the future, even if we’re accustomed to bad things occurring in the past. It may be illogical but it’s something we’re hardwired for according to the experts—it’s a phenomenon known as the human optimism bias(i)

One of the impacts of the human optimism bias can be unpreparedness. Because if we’re not taking a realistic and practical approach to the possibilities that arise for families every day, we could be jeopardising life as we currently know it. 

It’s in the stats

Every day, families face challenging experiences as a result of illness or injury. Cancer is a leading cause of death in Australia. In fact, about 3 in 10 deaths are a result of cancer. Half of the Australian male population and one-third of all women are expected to be diagnosed with cancer by the age of 85ii. 

Every family deserves to be able to maintain their lifestyle, while working towards getting better. At a time of illness or injury, we need support and comfort rather than the added financial stress of being unable to pay the mortgage or send the kids to school. 

Being ready can make the difference

What would happen if you or a family member were seriously injured or diagnosed with cancer or another serious illness? It’s true that if you have private health cover, your hospital and medical bills will make less of an impact on your bank balance. But say you couldn’t go to work for an extended period of time because you or your partner were critically ill—how would you meet your ongoing expenses such as mortgage repayments, car expenses and living costs? 

At such a time, a lump sum from a trauma insurance policy could make all the difference. It could help see you through financially and give you the time and peace of mind you’d need to recover. 

It’s important, while everything’s going relatively well, to take some time and consider the impact of an unexpected and unplanned illness or injury. Because while all is well, it’s natural to take for granted the ability we have to meet ongoing costs. And at the same time it can be easy to put plans in place ahead of time so you and your family are protected from the impact of an unplanned illness or injury. 

How a trauma policy helps

By holding a trauma insurance policy, you’re putting in place a safeguard in case you’re injured or diagnosed with a serious illness. 

Then, when the need arises, once your claim is approved you’ll receive a lump sum payment with no waiting period. Whether you’re working or not, you can hold a trauma policy and qualify for a lump sum payment so you’ll be able to recover without financial stress. 

And if you’re a parent, you may want to consider the impact of illness and injury on your children too. If a child becomes ill, a lump sum could help you meet your family’s ongoing needs while you take time off work to be there with your child. 

Spare yourself an hour for peace of mind

Often, people fail to realise they need to put cover in place while everything is going well. With our optimism bias designed to get in the way of clear thinking, it can be easy to dismiss the need to take practical steps to protect what we have. 

We all know life doesn’t always go according to plan. So be proactive and speak with us about how trauma insurance could help you look after your family and your lifestyle. 

 

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(i) The Optimism bias phenomenon is well documented by behavioural scientists such as The Behavioural Architects. 
(ii) www.cancer.org.au/about-cancer/what-is-cancer/facts-and-figures.html

Prosperity Financial Planning Pty Ltd (ABN ABN 91 161 761 208) trading as Prosperity Financial Planning is an authorised representative of Charter Financial Planning Ltd ABN 35 002 976 294, Australian Financial Services Licence and Australian Credit Licence No. 234665

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