What should you look for (and look out for) in life insurance?
Increase and retainArticle5 June 2023
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What you should look for (and look out for) in life insurance
How to understand which options are right for you
How to pick the right options in life insurance
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Understanding what’s included and how much it costs are important things to watch out for.
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Ensuring you have the right insurance for your family’s needs doesn’t have to be complicated. Let’s run through the process of reviewing the options and selecting the right ones for you.
It’s natural to make some assumptions when you think about the future, such as that you’ll always have a job and be able to work and earn income. And, of course, no one wants to think about death.
Life insurance is useful because it allows us to spend less time worrying about the consequences of future incidents. Here’s what to look for when you’re considering life insurance.
Inclusions and exclusions
Insurance companies are pretty strict on rules and classifications. The product disclosure statement (PDS) or insurance guide will tell you exactly what you’re covered for as well as anything that may be excluded. For example, a claim may not be paid if you were undertaking a high-risk or negligent behaviour when an injury occurred.
The PDS is an invaluable resource and something you should refer to whenever you’re looking at insurance.
Level of cover
Most policies offered through superannuation offer a default level of coverage. This may not be appropriate for everyone. For example, if you have children (or are planning a family) and have a mortgage, you’re going to need more coverage than someone who is single and renting.
Most people think about how much they would need to pay off major debts. You should also consider how much would be needed to support your partner and family’s long-term needs, such as ongoing bills and supporting your family. This is when it’s a good idea to get financial advice.
A flexible policy
Scaling up your insurance as your life changes is something that can give you more security and certainty for your future.
Understanding what you can change – and what it will cost – is an important tool to getting the most out of your coverage.
On the other side, as your responsibilities decrease, is it easy to reduce the amount of coverage you carry to reduce your premium?
How much does it cost?
One of the nice things about insurance through superannuation is that it’s generally much more affordable than buying an individual policy directly. That said, not all insurance policies are alike. Some may have longer waiting times before a claim will pay; in exchange, their premiums (the amount you pay for the policy) are lower.
If you think you’ll want more coverage than the default amount, it’s a good idea to factor that amount into your calculations.
How to check your insurance
Most superannuation funds offer limited financial advice on insurance needs, taking your individual financial circumstances into account, free of charge. You can learn more about what we can do by giving us a call on <<phone number>>. Quick, easy, and affordable. That’s insurance through super.
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Ensuring you have the right insurance for you and your partner’s needs doesn’t have to be complicated. Here’s what to look for when you’re considering life insurance. |
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Inclusions and exclusions Each insurer has a product disclosure statement, which should be your go-to resource. It tells you exactly what you’re covered for as well as anything that may be excluded. Super funds are required to display claim approval or acceptance rates on their websites, indicating what qualifies for a claim. Level of cover Most policies offered through superannuation offer a default level of coverage. This may not be appropriate for everyone. You need to consider how much you might need to pay off major debts if anything happened, and to support your partner. As a rule of thumb, you should have a policy with a death benefit that is 10 times your annual salary. A flexible policy Scaling up your insurance as your life changes can give you more security for your future. Some underwriters will require a health check if you take on additional cover and some may have a waiting period for the new cover to come into effect. Understanding what you can change – and the cost – is important. How much does it cost? Insurance through superannuation is generally much more affordable than buying an individual policy directly. But not all insurance policies are alike. Some may have longer waiting times before a claim will pay, making the premiums cheaper. If you need more cover than the default amount, you may pay more. |
| CTA | To learn more, read our full article <here>. |
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| Introduction | Ensuring you have the right insurance for you and your partner’s needs doesn’t have to be complicated. |
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But do you know what to look for when you’re considering life insurance, or total and permanent disability cover or income protection? |
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If you don’t and want to learn more, click <here> |
This information provides an overview only on specific topics and may be limited in scope or subject to qualifications and generalisations. It is provided for your use with insureds and superannuation fund members.
The information provided is also designed to be provided to insureds and superannuation fund members under your own name and any applicable licenses. You will need to consider whether the information is required to be changed or qualified in doing so. To the extent that there is inconsistency between the information on this website and the relevant policy, the policy will take precedence. You should take professional advice and review the appropriateness of the information before it is used by you.
This information does not consider any specific personal needs, objectives, or financial circumstances.
© Zurich Australia Limited ABN 92 000 010 195, AFSL 232510. Information within it is current as at May 2023 but may be subject to change. Updated information will be available by contacting Customer Service on 131 551.
