(Guest post by Shaun in Australia)
The tradition when buying both life insurance and income protection insurance has always been that if a person doesn’t earn any money, you don’t need to (or can’t) insure them. However, this doesn’t take account of the fact that although homemakers don’t bring any money into the household, they prevent plenty of money going out. Their contribution to financial health is on the outgoings side rather than the incomings, and now insurance companies have recognised this and started offering homemaker insurance policies. Do you need one? We help you decide today.
What is the Homemaker’s Financial Contribution Worth?
When you start adding up what it would cost to pay for contractors to fill the gaps left by a disabled homemaker, the end result can be pretty scary! In-home cooks, cleaners, laundry services, gardeners, tutors, taxi drivers and especially paid child care all charge a lot more than Dad or Mum would.
However, for some families the financial contribution will be less than others. All of these circumstances reduce the potential budgetary impact of a homemaker’s disability:
- Having no children, or
- Having older children, who are more capable of taking care of themselves
- Living in a small house, unit or apartment without a garden
- Eating proportionally more takeaway meals in a normal week
- Wearing uniforms to work (reducing laundry costs)
If there are many factors that reduce the homemaker’s financial contribution, it may be less worthwhile to take out homemaker insurance.
How Many Hours Does the Primary Breadwinner Work and Travel?
The longer that the primary breadwinner spends in working, and travelling to and from work, the less time is available to perform necessary housework. Also consider that, while there are undoubtedly people who work full time and then come home and do most of the housework, this is not a sustainable solution. If the breadwinner of the house works any more than 40 hours per week AND there are kids in the house, homemaker insurance could be a lifesaver.
What Is the Family Support Network Like?
Do you have plenty of flexible and willing grandparents or siblings to come help out in an emergency? In decades gone past, it was far more common to have a homemaker grandparent available to help out in an emergency. If all of your family members have their own commitments, there is a greater need for homemaker insurance.
Sit back and watch all the tasks that the homemaker actually performs in the home, and consider how you would get these done if they couldn’t … this is the ultimate test of whether you need homemaker insurance.