A recent study by specialist life insurer, TAL, values the stay at home parents? economy at over $22 billion annually based on their hours worked and using the minimum wage of $16.37 per hour. They advise that this is almost twice the value that volunteering contributes to the Australian economy.
The research found that the average working week for a stay at home parent is just over 43 hours and is broken down as follows:
Hourly breakdown of the stay at home working week
|Duties of stay at home mums||Hours spent|
|Shopping for family food, clothing etc.||4.2|
|Washing or ironing||5.3|
|Caring for / walking any family pets||3.4|
|Cooking for the family||8.6|
|Cleaning inside the house (including cleaning the bathroom, dusting, vacuuming or mopping floors etc.)||7.0|
|Cleaning outside the house||2.3|
|Other types of cleaning or tidying up (including cleaning up after cooking, making beds etc.)||4.8|
|Other household chores (such as cleaning the car)||1.5|
That amount of time begs the question: how would your household manage these tasks if the stay-at-home parent was ill, injured or no longer there?
According to TAL the vast majority of the stay at home workforce has no financial protection in the event injury, accident or illness prevented them from carrying out their vital domestic duties. So what types of insurance should stay-at-home parents consider? While income protection is not an option, some other important alternatives are:
Trauma Insurance: Trauma insurance can provide a lump sum of money to help you meet medical expenses and clear debts when you have suffered a medical trauma. The type of traumas covered will differ between policies, with some of the more commonly-defined events being cancer, heart attack, and stroke.
Total & Permanent Disability (TPD): TPD pays you a lump sum if you become totally and permanently disabled. The definition of total and permanent disability varies between insurance companies but it essentially means that you are disabled to the extent that you will probably be unable to work again. This may be defined as working in your own occupation or in any occupation again.
Determining the amount of each type of insurance that is appropriate will depend upon each household?s circumstances, but some questions to consider include:
- How much is required to clear all debts?
- How much is required to cover any medical costs?
- Would a lump sum be required to replace future earnings?
- Would a lump sum be required to cover any future child-related costs, such as care or education?
In commenting on the research findings, TAL Life CEO Brett Clark said: “we all know how much stay at home parents do for the family but this study enables us to put a dollar value on the domestic economy.”
Click here to find out about the various ways that you can buy life insurance.