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Insurance through super - What else to consider?

March  2019

In times of financial uncertainty, you might consider life insurance an unnecessary luxury. But what if you could keep your insurance cover without having to pay for it out of your everyday cash flow?

Insurance through super may seem like the perfect solution, but there are some things you should consider first:

  • The type and level of cover through super can be limited. It's important you and your financial adviser assess the options and decide the right cover for your situation.
  • There could be less money in your account when you reach retirement age, as the cost of your insurance premiums is deducted from your super balance.
  • Keep track of your insurances through super. If you have more than one super fund you may be paying for more than one policy.
  • Not all benefits are tax-free. Tax  may  be payable on some benefits, depending on who receives the benefit and when it is paid out. If your beneficiary is not a dependent, there may be tax implications.
  • There can be delays in benefit payment. Insurers will pay the benefit to your super fund's trustee, who will then distribute onto you or your beneficiaries.
  • Consider your beneficiaries. If you do not make a binding death benefit nomination, or if your fund does not offer binding nominations, the super trustee will decide who receives your benefits when you die. Usually benefits are paid to dependents, after taking your wishes into consideration.

How we can help

We can help you understand all the pros and cons of insuring through super and help build a solution that works for you.

Contact the team for further information about the different types of personal insurance, and help you tailor the right cover to your needs.

Get in touch

Topics: Inflation, Life cover, TPD insurance, Underinsurance, Cutcher & Neale Risk Insurance, Income protection, Tailored insurance, Premiums, Policy

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