Insurances for Risk Management

From: Greg Loucos


Hello all

Having recently purchased our first IP I now have some general questions on risk management. (Probably should have addressed these before buying.)

What type of personal insurances do people generally prefer to use to protect their investment, eg term life, income protection, whole of life?

Of these are any claimable as deductions seeing that you are taking them out to protect your investment.

Regards

Greg
 
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Reply: 1
From: Robert Forward


Hi Greg

I currently have included into my works superannuation the added benefits of extra life insurance and income protection.

Taking out these insurances through my employer super has two benefits, one is that is monies that the employer puts into the super fund, not mine. Another is that the insurances are paid with pre-tax dollars and the final benefit is that the costs of taking up these insurances is about 30% of the costs it would be if you took them out separately.

My employer super is with AMP and this was just all the benefits with it. Hope that helps.

Cheers,
Robert

Australian Speakers For Australian Conditions
http://www.Freestyler.net.au/events
 
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Reply: 1.1
From: Richard Hunt


Greg,

I would pursue Robert's views first and enquire whether your employer super may already cover you for various insured events. It's becoming more common for many employer funds to cover you automatically for death & disability and even trauma insurance. You may be pleasantly surprised.

Income protection insurance premiums incurred by you will be an allowable deduction.

You may also wish to investigate the appropriateness of more "asset specific" insurances like Landlord insurance which will also be an allowable deduction.


Regards
Richard
 
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Reply: 1.1.1
From: Greg Loucos


Thanks Robert and Richard

I do have insurance included with my super but what about if the level of insurance is less than the amount you are in debt.

I was wondering which form of insurance would be best and if any had any taxation advantages.

Regards

Greg
 
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Reply: 1.1.1.1
From: Robert Forward


Hi Greg

You should be able to increase your insurance within your super. I have quadrupled mine easily enough and can go up another 20% when needed.

This would be your cheapest way of gaining the insurance needed.

Cheers,
Robert

Australian Speakers For Australian Conditions
http://www.Freestyler.net.au/events
 
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Reply: 1.1.1.1.1
From: Greg Loucos


Robert

Thanks for that I will check with the fund.

Regards

Greg
 
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Reply: 2
From: Alan Hill


Greg,

Wouldn't that be wonderful!

I think I asked Dale the same question some time back and he basically said that in 99.9% of cases Life Insurance wouldn't be deductible.


:)
 
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Reply: 2.1
From: Rolf Latham


Hiya

It is for those with self managed super funds where the fund pays for the premium I think

Ta

Rolf
 
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Reply: 2.1.1
From: Richard Hunt


Rolf,

That's right, in fact any complying superfund whether self-managed or not can claim various portions of these premiums as an allowable deduction.

Regards
Richard
 
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