What are the three most important types of insurance your generation should have?

AWESOME! Would you like to talk insurance? Or would you rather grab some kitchen knives and surgically remove your own appendix?

Weird, but insurance is the “great grudge purchase”. You know you need it. You just don’t want to pay for it.

Weirder, when you do insure, it’s the least valuable stuff. More people insure their cars (89 per cent) than their homes (77 per cent). The insurance often costs similar amounts, but the car costs $25,000 and the house would be $250,000 to replace.

Weirdest, you don’t insure that which would financially devastate you – your life and your health. How would your family cope if you had a major accident/illness and couldn’t work?

If you’ve got kids, what happens if you die? Can your partner replace your income? No? Then you need death cover. Enough to make sure your kids can be raised as you would have … if you weren’t, you know, dead.

Either people don’t think about it, or they don’t care. Only about 12 per cent have adequate coverage for life, total and permanent disability, trauma and income protection insurances.

Gen Xers’ most valuable asset is their ability to work. You do the math. If you’re 40 and earning $100,000, you’ll earn $2,500,000 before you turn 65. Do you own any assets worth that much?

After the life insurances, Xers need property insurances – your house, contents and your car.

The I’d say health insurance. Medicare is pretty good, but given the penalties for high-income earners without hospital cover, it’s often a financial no-brainer.

Bruce Brammall is the author of Debt Man Walking (www.debtman.com.au) and principal adviser with Castellan Financial Consulting.