Insurance Advice

Most Australians have default life and TPD cover through their super, and sometimes income protection. The default amounts are generally nowhere near what a typical family needs. Defaults often assume a single 25-year-old with no dependants, which doesn’t match a 42-year-old with a mortgage and kids. We always audit existing cover before recommending anything new.

It depends. Inside super means premiums come out of your super balance (no impact on take-home pay) but erodes retirement savings. It also has different tax treatment for TPD payouts and may have cheaper group premiums. Outside super offers better policy terms in some cases (especially for income protection and trauma) and doesn’t eat into super. The right answer for you depends on your cash flow, age, and cover need. We usually recommend a mix.

Enough to clear your debts, cover your dependants’ living costs for the years they’d need support, fund the kids’ education, and ideally provide some capital for your partner’s retirement. A rough starting point is 10 to 12 times annual income if you have young kids and a mortgage, but that’s not a substitute for a proper needs analysis. We do the maths specific to your situation.

Stepped premiums start cheaper but increase every year as you age. Level premiums cost more now but stay flat (roughly) until 65. For most people under 45 who plan to keep the cover to retirement, level usually wins over a 20-year horizon. Over 45 or with a shorter timeframe, stepped usually wins. We model both over your expected cover duration so the choice is numbers-driven.

For anyone whose household relies on their income (basically anyone under 60 who works), yes. Income protection pays a monthly benefit (up to 70% of income) if you can’t work due to illness or injury. Unlike workers’ comp, it covers non-work illness and injury, and it can pay for years. It’s the single most important cover for most working-age Australians.

Total and Permanent Disability cover pays a lump sum if you’re permanently unable to work. It’s different from income protection because it’s a one-off payout rather than an ongoing monthly benefit. TPD covers catastrophic outcomes: severe injury, progressive illness like MS or Parkinson’s, or a stroke with lasting impairment. Most families want both TPD (for the big event) and income protection (for the temporary disability).

Trauma (also called critical illness) pays a lump sum on diagnosis of a specified serious condition: cancer, heart attack, stroke, major organ transplant, and similar. It’s designed to cover out-of-pocket medical expenses, time off work during recovery, and lifestyle adjustments. It’s separate from life insurance, which only pays on death. Trauma is often the least-held cover and the one people most wish they had when something serious happens.

Pre-existing conditions are always disclosed during underwriting. The insurer may offer cover with exclusions, a loading (higher premium), or decline cover for that specific condition. Lying on an application is the fastest way to have a claim denied years later. We work through disclosures with you and coordinate directly with the underwriter to get the best possible terms.

Most insurance inside super ceases when you stop contributing or roll into pension phase. If you still need cover (for example, because your partner still works, or you carry debt into retirement), we design a separate retail policy that continues. If you don’t need cover anymore, we cancel it cleanly and redirect the premiums into your retirement income.

Commission-based insurance advice creates an incentive problem: the adviser gets paid more for a larger policy, whether or not you need it. Our fee doesn’t change based on the premium, so our recommendation is based on your need. In most cases, our fee is cheaper than the commission you’d otherwise pay in year one, and the policy often has a lower ongoing premium because the insurer doesn’t have to fund commissions.