Life, Disability, Income Insurance etc
- Thread starter RedCat
- Start date
I thought that to until I became disabled in my early 20's with no income insurance from a good wage to dismal wage you soon wish you took out that
income protection
Good Point James.
We had insurance in our early twenties and set the cover at the level to pay our the mortgage in the event one of us was killed or permanent disabled. having paid PPOR out now it seems we are insuring to simply have a windfall, which is silly if your dead!
Sorry to hear about you.
Our fear is they will not cover when if the time comes as per the above post,
Still thinking Peter
That won't cost much
. Family will survive somehow as long as there is a roof over their head. However, what if we are disabled!! That is the scary part.That won't cost much
Agree, hence we insured. Now past that risk and with independent income I am searching for reasons to continue the cover.
Peter
Since I have just dropped a deposit on a new house I recently took out the insurances.
Death: $1.8M
TPD: $1.3M
Trauma: $160K
IP: $75% salary (30 day wait, age 65)
Level premiums.
For anyone who relies on their income to fund their lifestyle insurance is a must. I don't want to go backwards financially should something unexpected occur.
I work in the industry I have seen with my own eyes the financial impact of not having insurance. Last year (2012) I handed over claim payments totalling just under $2.2 million, not including a number of ongoing income protection claims. Had these guys had no cover they would be financially screwed.
It amazes me that people feel it is a must to insure their cars / houses etc but wont bother insuring their most important financial asset: their ability to earn an income. This pays for your cars, houses, lifestyle and a lot more. Lose your income and your finished.
My tip, get proper advice. You will be surprised at the level of cover you require. And don't go direct (insurance you see being flogged on TV. They are rubbish products with nasty exclusions which they won't make you aware of and generally not any cheaper. Plus they provide no advice re structuring etc).
Death: $1.8M
TPD: $1.3M
Trauma: $160K
IP: $75% salary (30 day wait, age 65)
Level premiums.
For anyone who relies on their income to fund their lifestyle insurance is a must. I don't want to go backwards financially should something unexpected occur.
I work in the industry I have seen with my own eyes the financial impact of not having insurance. Last year (2012) I handed over claim payments totalling just under $2.2 million, not including a number of ongoing income protection claims. Had these guys had no cover they would be financially screwed.
It amazes me that people feel it is a must to insure their cars / houses etc but wont bother insuring their most important financial asset: their ability to earn an income. This pays for your cars, houses, lifestyle and a lot more. Lose your income and your finished.
My tip, get proper advice. You will be surprised at the level of cover you require. And don't go direct (insurance you see being flogged on TV. They are rubbish products with nasty exclusions which they won't make you aware of and generally not any cheaper. Plus they provide no advice re structuring etc).
Another trick is make sure you declare if you ride a motorbike.. for those motorbike riders out there!...
It is one of the ones that is deemed as a "dangerous sport", like skydiving etc. I declared that i ride road and race track, so if anything happens on either i am covered... just be aware some policies wont cover you if you have not declared it!!!!!! It is better to be safe and tell them that way they cannot deny it.
Another thing, if you are female and thinking of having a family, you may want to reduce the 90 day wait down to 30 day wait. The reason for this is, I have income protection with my super, and if i have a issue during pregnancy where the doctor says i am unable to go to work - so aka strict bed rest, then after 30 days i am covered. They will not cover normal pregnancy to take time off, but you are covered if it is obviously a harm to you or your baby and you have Dr report. I was in a situation where this may of occured, and i knew for the remaining 3 months at least i would of had income coming in until maternity leave kicked in. check your pds if they cover pregnancy issues though. Mine does.
I just have inc prot and tpd with my super and mine does to age 65. I have to take out two seperate policies though. One is for the 30 day to 2 years and the 2nd is for after 2 years and up to age 65. Your super may offer this but hasnt told you. Take a look on their websites for the products they offer!
Take a look at your super policy reguarly because when your pay increases you may only get 75% cover of the max level of the premium your paying, so if you havent looked at it in a while then you may be off quiet a bit!. I had a pay increase of 15K - change of job - so i had to get my cover upped to make sure I was covered. I have could of been on the lower level of protection, but choose to go to the next band up. I was $500 a year in earnings off being in the next band anyhow, and i figured when my pay rise comes through - which it does yearly, that i would of had to up the level anyhow and go through the rigmorale of getting the cover reapproved, so just went up to that level anyhow without me having to worry about looking at that in 6 months time, so plan for the future.
With TPD I chose to cover a certain amount payout as opposed to going with the reducing amount of payout and keeping my insurance premium the same as i get older. Once the amount reduces it is normally much harder to get that amount upped, so i have mine at 500K payout it wont go down but the cost to insure that amount will go up over time. For me i wanted my two IPs paid off completely and that way i could put this in a trust fund for any kids i may have in the future.
It is one of the ones that is deemed as a "dangerous sport", like skydiving etc. I declared that i ride road and race track, so if anything happens on either i am covered... just be aware some policies wont cover you if you have not declared it!!!!!! It is better to be safe and tell them that way they cannot deny it.
Another thing, if you are female and thinking of having a family, you may want to reduce the 90 day wait down to 30 day wait. The reason for this is, I have income protection with my super, and if i have a issue during pregnancy where the doctor says i am unable to go to work - so aka strict bed rest, then after 30 days i am covered. They will not cover normal pregnancy to take time off, but you are covered if it is obviously a harm to you or your baby and you have Dr report. I was in a situation where this may of occured, and i knew for the remaining 3 months at least i would of had income coming in until maternity leave kicked in. check your pds if they cover pregnancy issues though. Mine does.
I just have inc prot and tpd with my super and mine does to age 65. I have to take out two seperate policies though. One is for the 30 day to 2 years and the 2nd is for after 2 years and up to age 65. Your super may offer this but hasnt told you. Take a look on their websites for the products they offer!
Take a look at your super policy reguarly because when your pay increases you may only get 75% cover of the max level of the premium your paying, so if you havent looked at it in a while then you may be off quiet a bit!. I had a pay increase of 15K - change of job - so i had to get my cover upped to make sure I was covered. I have could of been on the lower level of protection, but choose to go to the next band up. I was $500 a year in earnings off being in the next band anyhow, and i figured when my pay rise comes through - which it does yearly, that i would of had to up the level anyhow and go through the rigmorale of getting the cover reapproved, so just went up to that level anyhow without me having to worry about looking at that in 6 months time, so plan for the future.
With TPD I chose to cover a certain amount payout as opposed to going with the reducing amount of payout and keeping my insurance premium the same as i get older. Once the amount reduces it is normally much harder to get that amount upped, so i have mine at 500K payout it wont go down but the cost to insure that amount will go up over time. For me i wanted my two IPs paid off completely and that way i could put this in a trust fund for any kids i may have in the future.
Just be aware there are a few pitfalls by having your Income Protection through super.
Firstly, super law restricts the amount of Income Protection benefits that can be paid from a super fund. Where your income protection cover exceeds the amount of your actual pre-disability earnings, the excess amount is retained in superannuation until a condition of release is met
(retirement once reaching preservation age).
Upon lodging a claim, the amount you would receive is based on your salary 12 months prior to the claim. As such, say in the 12 months prior to a claim you took 6 months unpaid leave and only earned say $35,000, then the benefit you would receive from Income Protection would be $2,187 per month ($35K / 12 * 75%). You may be insured for more than this, however any excess claim payments are held with the super fund until a condition of release is met.
Holding the Income Protection in your own name and selecting an Agreed Value policy eliminates this.
Also, regarding pregnancy you usually need to be deemed 'totally disabled' for 90 days before income protection will pay out, even if you have a shorter waiting period. Your policy may be different however I would check the PDS to make sure.
So i wonder if this applies to OT then, because its part of my income, if thats the case then im under insured, but i beleive it is not included. However I also receive bonus payments too, but as far as i was aware it was what your base salary is. Also again my super i can be on leave without pay for 12 months and still be covered in that period.
You are if it is a "complicated pregnancy" with my super. Uncomplicated pregnancy you have no cover. So if you are put on strict bed rest because of cervix issue that would be a complication in the pregnancy.
Im with energy super. They are pretty good with their policies, because it was originally under esi super which was for government employees only at one stage, so the conditions are really good for me.
