In your ‘prime earning years’, typically your 30s and 40s, life can feel like a balancing act. Between a growing career, raising children, paying off a mortgage, and starting to accumulate wealth, the financial responsibilities can feel overwhelming. At this stage, your ability to earn and provide stability for your family is one of your most valuable assets. Yet, few Australians stop to consider what would happen if illness, injury, or even death disrupted that stability. Without the right insurance in place, all of your hard work could unravel. Not only is insurance an incredibly important safety net during your prime years, but there are also a few key types of cover to consider, and a tailored insurance strategy can protect not just you, but the people who rely on you.
Why Insurance Matters in Your Prime Years
As your career grows, so do your responsibilities. Mortgage repayments, childcare costs, education expenses, and maintaining your family’s lifestyle all depend on your income. Research shows that 83% of Australians insure their car, yet only 31% insure their income — even though your income is what pays for everything else.
Your ability to earn is often your biggest financial asset. Losing it, even temporarily, could put your family under severe stress. A well-structured insurance plan helps safeguard against the unexpected, ensuring your loved ones don’t suffer financially if life takes a sudden turn.
Life Insurance: Protecting Your Family’s Future
Life insurance provides a lump sum payment to your loved ones if you pass away. This can help pay off debts like the mortgage, cover school fees, and provide ongoing financial security for your family.
Underinsurance on life policies is a significant issue in Australia. Research by the Financial Services Council (FSC) found that one million Australians are underinsured for death and total permanent disability (TPD) cover, and 3.4 million are underinsured for income protection. Without adequate cover, your family may struggle to maintain their lifestyle in your absence.
By ensuring you have the right level of life cover, you can protect the progress you’ve made so far — and give your loved ones peace of mind.
Income Protection: Safeguarding Your Greatest Asset
For many in their 30s and 40s, the biggest financial risk isn’t dying prematurely — it’s losing the ability to work due to illness or injury. Income protection insurance replaces a portion of your income (usually up to 70%) if you’re unable to work.
Think about your monthly mortgage repayments, bills, and living expenses. Without income protection, these obligations could quickly become unmanageable. Yet despite its importance, millions of Australians remain underinsured. In fact, 3.4 million Australians lack adequate income protection cover.
Income protection ensures you can continue meeting your financial commitments while you focus on recovery, preventing your family from being forced to sell assets or take on debt to survive.
Trauma (Critical Illness) Cover: Immediate Support in Tough Times
Medical emergencies don’t just create emotional strain — they can also cause serious financial hardship. Trauma cover pays a lump sum if you’re diagnosed with a major illness such as cancer, stroke, or heart attack.
The financial impact of these conditions can be staggering. For example, the annual cost of cancer treatment in Australia can reach hundreds of thousands of dollars in some cases. Trauma cover provides funds to pay for medical expenses, rehabilitation, or simply to reduce financial pressure during recovery. It allows you to focus on your health rather than worrying about how to pay the bills, and ensures your family’s financial wellbeing is looked after during a challenging time.
TPD (Total and Permanent Disability) Insurance: Preparing for the Unthinkable
While no one expects to become permanently unable to work, serious illness or injury can make it a reality. Total and Permanent Disability (TPD) insurance provides a lump sum payment if you become permanently disabled and are unable to return to work in your usual occupation — or in any occupation, depending on your policy definition.
This payment can help clear major debts like your home loan, cover ongoing medical or care expenses, or even fund home modifications if required. Importantly, it can also provide financial stability for your family when your ability to earn an income is permanently affected.
Many Australians assume their superannuation fund provides sufficient TPD cover, but this default insurance is often limited in both scope and payout value. As a result, around one million Australians are underinsured for death and TPD (FSC, 2022). Reviewing your level of cover — and whether it’s held inside or outside super — ensures you’re adequately protected.
By integrating TPD into your overall insurance plan, you can help secure your long-term financial independence and reduce the potential burden on your loved ones.
Insurance in Your Prime Earning Years – Balancing Cost and Cover
Insurance premiums can sometimes feel like “just another expense.” However, when compared to the potential financial fallout of being unprotected, they can represent incredible value as a safety net.
Policies can be tailored to your circumstances. Options like adjusting waiting periods, choosing stepped or level premiums, or holding cover inside or outside of super can make insurance more affordable and flexible.
This is where quality advice makes the difference. A financial adviser can assess your unique needs and help you avoid the common traps of being either underinsured or overinsured. As the FSC notes, reforms that make advice more accessible could help an additional one million Australians secure the life insurance cover they need.
Insurance to Protect What You’ve Built in Your Prime Earning Years
You’ve worked hard to build a career, provide for your family, and lay the foundations for long-term wealth. But without insurance, especially in your prime years, one unexpected event could undo years of progress.
The right mix of life, income protection, and trauma cover provides a safety net for your family’s financial security. It’s not about expecting the worst — it’s about ensuring that, if the worst happens, your family has the support they need.
At Priority Advisory Group, we can review your current arrangements, identify any gaps, and tailor a plan that protects what matters most. Call us on 1300 349 188 or visit https://www.priorityag.com.au/contact/ to arrange an insurance review today.
References & Further Reading
- Financial Services Council (FSC) Media Release: Good advice would see a million more Australians with the life insurance they need — https://www.fsc.org.au/news/media-release/good-advice-would-see-a-million-more-australians-with-the-life-insurance-they-need