Your Questions Answered
When it comes to the all-important decision to seek wealth protection advice, it pays to have all the information at hand before you fully commit. We also want you to be absolutely sure that we’re right for you and/or your business.
With that in mind, we’ve come up with this list of frequently asked questions, which should cover just about everything you might want to know to get you moving forward. If you still have some unanswered questions, please contact us on 1300 822 902 and we’ll be happy to help.
Q Do insurance companies really pay?
A Yes. Insurance companies do pay legitimate claims. To give you an idea. Risk Store statistics in 2011 showed 62,352 life insurance claims were payed Australia wide – totalling $3,982,014,264 billion in that one year alone
Q Is protecting my income a cost effective investment?
A Yes. Income replacement premiums are affordable and generally tax deductible. As outlined earlier, a 30 year old white-collar professional can protect 75% of an income of $100,000 ($6,250/ month) for around only $1.50 a day[1]. If the client was totally disabled one month after the policy was taken out and never able to work again, the policy would continue to pay for the next 35 years. That’s over $5 million paid out to replace lost income with no ongoing premiums. In addition, while on claim, the sum insured will be indexed each year to keep pace with inflation
Q Are we authorised to provide advice with regard to life insurance and other personal protection products?
A Yes we are fully qualified financial advisors who specialise in personal and business – wealth protection
Q How are we paid. Do we receive a commission?
A There is no direct charge to you for receiving advice on an appropriate life insurance product. This is because we receive payment as commission from whichever insurance company offers the product we deem to be most appropriate for your situation. And because we are not fixed to one particular insurer, it means you’ll get to choose from a wide range of very competitive premiums
Q What are the payment options and methods of payment?
A Most insurers offer monthly, quarterly, half yearly and annual payment options. You can choose to pay by a cheque, direct debit, or by credit card
Q What are stepped and level premiums?
A Stepped premiums are calculated at each policy anniversary date at your current age and will increase each year. Level premiums are fixed at a flat amount which is only varied with increases in the general level of rates. In the early years, level premiums will be more expensive, but if you intend to hold your cover over the long term the savings can be significant
Q What type of medical advice may be required?
A Depending on your age, your sum insured and your medical history you may be required to undergo a medical examination, blood test or ECG as part of the underwriting process. If this is required we are able to organise most of these requirements in the comfort of your own home or a place you nominate
Q Am I locked into the cover for a certain period?
A No. The policy that you establish can be cancelled at any time by you without any penalties
Q Can my policy be cancelled by the insurer?
A No. Unlike other forms of insurance, once the policy has been accepted it is guaranteed renewable by the insurance company. The life insurance company cannot cancel the policy due to a change in your health however you need to ensure that you continue to pay your premiums on time to ensure your policy stays in force
Q What are the tax implications?
A Income protection and business expenses premiums are generally fully tax deductible to the policy owner but any benefits paid are classed as income. If a Term Life and/ or TPD policy is not written through a superannuation fund, the premiums are generally not tax deductible and any proceeds recovered are not considered to be classed as income. If a Term Life and/ or TPD policy is written through a superannuation fund, the premiums are tax deductible to the fund. Taxation of death benefits depends on whether the benefits are paid to a dependent, non-dependent or to the Trustee of the deceased’s estate. Taxation of any TPD benefits paid from superannuation depends on whether the member is eligible for a tax free invalidity component and access to these funds requires meeting a condition of release from superannuation. As everyone’s circumstances are different, we recommend you seek taxation advice from an independent tax adviser
Q What insurance companies do we deal with?
A We deal with a wide range of insurance companies to ensure that an extensive range of quality, cost competitive insurance solutions are available to you
Q How do I get started?
A Simply call us on 1300 822 902 to get your FREE no obligation appraisal. You’ll be serviced by a qualified expert who will tailor a wealth protection plan to suit the unique needs of your situation
1 Cost based on monthly premium of $45-95 after tax deduction (marginal rate of 38.5% including Medicare levy) for an agreed value One Path Income Secure Comprehensive Policy, stepped premiums for a degree qualified accountant, 30 year old male, non-smoker, with a monthly benefit of $6,250 (75% of income), waiting period of 30 days and benefit period to age 65. QLD stamp duty included. CPI 3.5%. Premium current as at March 2013. This is not a recommendation and the insurance company selected for quotation was done so randomly.
