Income Protection Insurance In Superannuation Funds

On canstar s database 11 super funds canstar rates offer default income protection and all funds in the market except one offer tailored income protection insurance that you can purchase.

Income protection insurance in superannuation funds. Income protection ip insurance sometimes called salary continuance insurance is available through about a third of super funds as default cover. Other aware funds. There are pros and cons to taking income protection insurance through your super. Questions are being raised as to whether your superfund is the best place for all your cover.

Pre existing medical conditions and lifestyle factors such as smoking may impact the cost of premiums whereas group insurance inside superannuation may have automatic acceptance. However it s important that you regularly review whether or not the coverage provided is appropriate for your needs when your circumstances change over time. A key shortcoming is superannuation contributions funding income protection cover are included in the concessional contribution cap which is set at 30 000 per year or 35 000 per year if aged over 49. However purchasing income protection insurance through superannuation can present significant disadvantages.

Insurance in your superannuation. Afsl 233788 trustee of australiansuper abn 65 714 394 898 superannuation fund number sfn. 2683 519 45 superannuation product identification number spin. Income protection insurance can also be useful where what initially appeared to be a short term injury is later diagnosed as permanent.

It pays you the income you were receiving prior to becoming temporarily disabled and. Paying too much for income protection insurance inside your super fund can cost you dearly eating into your retirement savings without necessarily improving your cover. Income protection can help if you become ill or injured. Super funds have different names for income protection insurance.

Fortunately many australians can get income protection insurance through their super fund and in some cases may even have it by default. Help safeguard your finances against the unexpected. If the income protection policy provides for benefits of an income and capital nature the ato s view is that only that part of the premium attributable to the income benefit is deductible 1. A default level of insurance coverage is automatically provided when you join a super fund.

Instead of a lump sum income protection generally pays you on a monthly basis to cover part of your lost income. This will typically provide a more basic level of cover. Superannuation funds have long provided a minimum amount of life insurance to members but many are now starting to add other types of insurance income protection insurance is one of them.