Insurance

How to protect your wealth and our standard of living are two of the most important financial questions we need to ask.  Yet “around 59% of Australian families would not be able to maintain their current standard of living if the main earner of the family were to pass away”*.  For people placed in this position, this may mean selling the family home, or changing schools for the children with the remaining partner being left to manage significant debt.

Consider what the greatest assets are in your life and what you would do if you lost the capacity to work or were not able to support your family and their lifestyle.

The Vault team can help you identify an appropriate amount of cover for your individual circumstances. Whether it be life insurance, trauma insurance or income protection, our advisers work with the best insurers in the country to make sure that you and your family are protected in the event of personal crisis.

CASE STUDY

One of Vault’s own key staff members, Justin McKay learned through personal experience how important this protection is.  As a result of a coal mining workplace accident in 2008, Justin discovered first-hand the importance of having adequate protection and that accidents can happen to anyone.  Being a physically fit and strong 25year old, he hadn’t thought insurance was relevant to him.  Without insurances in place, his options for treatment, recovery and lifestyle were then very limited.  His experience influenced his mates (both on and off the sporting field) to think seriously about their own lifestyles and financial situations.  Justin turned this negative time in his life into a positive one by becoming a personal advocate for wealth protection strategies.  He was determined from then on to help build awareness that insurance is essential for everyone and with the right guidance, shouldn’t be a difficult process or be a financial burden.

Please contact us here or call us now on (07) 3608 6800 to get a comparison or competitive quote today.

*Rice Warner Underinsurance in Australia report 2012

Is personal insurance affordable?

Your individual needs and financial circumstances will directly influence affordability. However, it is important to know that most life insurance can be paid from your superannuation fund or SMSF, which means premiums won’t affect your week-to-week income.  There may be some out-of-pocket costs but these will be for specific coverage over and above that which the ATO allows to be paid from superannuation.

What other ways can I protect my wealth?

Depending on your circumstances there may be other ways to protect your wealth, which may involve the establishment of a company structure or a family trust.  By taking the time to discuss this with one of the Vault advisers or accountants, will ensure that all your personal and business considerations are identified before an appropriate structure can be customised to protect your assets.  Off-the-shelf solutions don’t necessarily protect everyone. It’s worth investing a little time with an expert to explore the best ‘fit’ for your individual circumstances.

Am I locked into the insurance cover for a certain period?

No. The policy you establish can be cancelled at any time without any penalties.

Can the insurance company cancel my policy due to my health?

No. The insurance company cannot cancel your policy due to a change in your health (unless you fail to disclose at the application stage).

What's the difference between Stepped and Level Insurance Premiums?

Stepped premiums increase each year as you get older; the amount they increase each year will depend on age:

  • From age 20-30, little if any increase each year
  • From age 30-40, average 6% increase each year
  • From age 40-50, average 8% increase each year
  • From age 50-60, average 10% increase each year
  • Above age 60, average 15% increase each year.

Please note that this is a guide only to annual increases if your cover remains constant. If you take the CPI increase, premiums will increase by an additional 3%-5% each year.  This means that as you get older the insurance premiums can get quite high, but there is one way to avoid this – level premiums.

Level premiums are those which remain constant up to the age 65 as long as the cover remains constant.  Level premiums may be higher now, but over the long term they are significantly cheaper.  Where appropriate we will always provide quotes on stepped and level premiums. Note that if you select level premiums, after age 65 they automatically transfer to a stepped premium.

Will the personal insurance policy cover me whilst travelling overseas?

Yes. All our insurance products provide cover 24 hours a day, wherever you are in the world.

How do the different insurance policies you quote, compare?

We aim to provide clients with as much choice as possible and will itemise the premiums of various companies for various levels of cover.  Term life insurance is purely cost-based, as all companies will pay upon your death.  Trauma and income protection policies however, will vary between companies. We can provide specific comparisons if you wish.

Does the insurance policy have a cash value?

The only policies that have a cash value are older-style whole-of-life policies or a money-back life policy.  These are generally very expensive and few companies still offer them.  What we will recommend is term life cover, which does not have a cash value.

How do I pay my insurance premiums?

Companies offer the choice of three methods of payment (monthly, quarterly or annually) by:

  • direct debit
  • credit card
  • cheque.

Do I need to have a medical examination before taking out an insurance policy?

Most people do not require a medical for establishment of cover. Whether you will need a blood test or other medical requirements will be determined by your age and the amount of cover you apply for.  The life company will pay for any medical testing and we arrange these for you.  In most cases we have a nurse visit you to complete the tests if the company requires you to have them.  This ensures the process is as quick and as convenient for you as possible.

Are there any tax implications with an insurance policy?

If a term life policy is written through a superannuation fund, the premiums are tax deductible. Taxation of death benefits depends on whether the benefits are paid to a dependant, non-dependant or to the trustee of the deceased’s estate, and the total amount in superannuation.

If a term life policy is not written through a superannuation fund, the premiums are not tax deductible but any proceeds recovered are not considered to be assessable income.

Does Vault provide discounts on insurance policies?

Whilst we consider our service is second to none, we understand that policy decisions sometimes come down purely to price over service level, so on occasion we may agree to rebate some of our commission received from the life office (even though this commission is paid at no cost to you the consumer).  In the event that we agree (after negotiating on a case-by-case basis) we will provide a discount that applies to the first year’s premium only in the form of a cash rebate based on your premium, up to a maximum of 15%.  It will be paid up to 50%, ie. 7.5% discount is paid to you at the completion of your policy and the remaining balance is paid at the renewal of your policy, at the start of the second year.  To be entitled to the discount you must lodge your application within 30 days of the original quotes being provided, and you must renew your policy in twelve months to receive the balance of the discount.  No further discounts will apply.