The business of insurance is sustained by a complex system of risk analysis. Generally, this analysis involves anticipating the likelihood of a particular loss and charging people enough in premiums to guarantee that insured losses can be paid to property holders when a loss is incurred. From the insured point of view, the individual/company is managing risk that cannot be avoided. You could die, the house can burn down, your salary could stop, etc.  Whenever you decide not to seek cover for loss or harm, you are gambling that you/your family/your business will survive the odds that are contained in risk analysis science. That is, that your assessment of risk is preferred to calculated risk, based on actual experience and personal profiling. The practice of appraising and controlling risk has evolved over time for one primary reason: avoiding, mitigating and transferring certain risk creates greater predictability for individuals and businesses and to allow people and organisations to use the existence of risk more consciously and intelligently to maximize their opportunities, both economically, financially and in terms of securing peace of mind.

There are very good reasons why the issue of insurance should be at the forefront of mind for everyone and not as an option to ignore or postpone.

The most common types of risk (life) insurance are:

People hold a number of misconceptions about the role of financial planners, according to the Financial Planning Association (FPA). Kerrie Kelly, former chief executive of the FPA said that a number of recent surveys showed that clients of financial planners were satisfied with the advice and service they received, and recognised the value of that advice.

“Such surveys also show that people who use advisers are more likely to reach their financial goals than those who don’t,” she said. However, other people incorrectly see financial planners as just investment advisers or that their role is solely to do with recommending, or even promoting, certain investment products.”

Ms Kelly said that the “product” of a good financial planner is tailor-made advice. “While it is perhaps understandable that investment savvy individuals may think to themselves. ‘ I can do it myself. Why should I need the advice of anybody to tell me what fund I should put my money in, or how to finance my investment property?’

“But this is a very small part – in fact, the by-product – of the advice that financial planners give,” Ms Kelly said. The range of advice a planner provides includes such things as considering appropriate retirement savings strategies, helping a client to decide on the right asset ownership structure, looking at the risk entailed in various investment alternatives, and approaches to manage and reduce the cost of debt.

“What financial planners do is help each client meet his or her financial goals, taking into account individual circumstances and aspirations and the options that are available.

“Today’s financial planners are experienced in advising clients how to balance current lifestyle against future needs. They help them understand the difference between lifestyle assets – such as a car, and investment assets – such as shares, which provide for a future lifestyle.

The underlying principle of professional practice for financial planners who are FPA members is putting clients’ interests first.”

Although financial planners have been around for a while, the FPA has found that people were still partly unaware of what they did, how they charged, what licences and qualifications they must hold, how the industry is regulated, and who benefits from a planner’s advice.

A standard Will offers little assistance to a beneficiary of an inheritance in relation to issues of tax efficiency and asset protection. In contrast, a modern estate plan will include testamentary trusts which will provide your beneficiaries with maximum flexibility in dealing with their inheritance. The usefulness of a discretionary Will trust to a beneficiary will depend upon the beneficiary’s specific needs and circumstances at the time of your death so it is important that the terms of the testamentary trust are sufficiently wide to offer the beneficiary as many options as possible so as to provide freedom and flexibility. Because a testamentary trust can live for up to 80 years from your death it can provide flexibility, asset protection and taxation advantages for many generations of your family.

Traditionally, banks and other lending institutions have distributed their own products. However, as markets for mortgages have become more competitive, the role of the mortgage broker has become more popular. Today in most developed mortgage markets (especially the US, UK, Australia, Spain and Canada) mortgage brokers are the largest distributors of mortgage products for lenders.

The majority of mortgage brokers are regulated to ensure a level of protection for the consumer. The extent of the regulation depends on the jurisdiction.