Redundancy Insurance

Discussion in 'Legal Issues' started by redwing, 14th Jun, 2015.

  1. redwing

    redwing Progress Not Perfection

    Joined:
    16th Mar, 2004
    Messages:
    8,533
    Media:
    69
    Location:
    WA
    Someone was recently telling me they had taken this out

    I see some policies i.e. NRMA have

     
  2. sash

    sash Member

    Joined:
    10th Feb, 2003
    Messages:
    3,581
    Location:
    North Shore, Sydney
    You are much better off putting the premiums and creating your own insurance.

    These policies are quite expensive for 3 mths.

    Also how much leave will you have and how many years service with an employer also counts. But if you get fired its another story..

     
  3. Rolf Latham

    Rolf Latham Member

    Joined:
    2nd Mar, 2001
    Messages:
    18,791
    Location:
    Confused = Sydney, Brisbane and Gold Coast
    I hear APRA are coming up with a policy of their own

    ta

    rolf
     
  4. Paul@PFI

    Paul@PFI Tax, SMSF & Planning

    Joined:
    2nd Jul, 2013
    Messages:
    2,778
    Location:
    Sydney
    Income protection insurance must be costed based upon a range of factors incl age, health issues, etc. Policy wording can be highly restrictive by using specific terms such as own occupation / any occupation. Premiums also affected by waiting period, level of cover (up to the legal limit!!), term of policy (3mths, 6mths, 12mths, age 65). Some end when a claim is made and others allow multiple claims. I have even seen self employed people consider such policies and been denied a claim. (ie not employed !)

    I have a tax client who had IP policy and was diagnosed with MS. Her policy was to age 65 so she had income for 8 years.

    Income policies can have add ons such as redundancy, trauma etc

    Such policies can be of limited value in a super fund and premiums are deductible. Often such group policies are cheap but with some terms that restrict value. Access to super income policies can be a difficulty for younger workers unless disabled by the incident.

    Personal financial advice is a must. Those aweful policies flogged on TV are really aweful and are often 3 month policies with a $5K limit a month etc.
     
    ozmale42 likes this.