The Australian Retirement Trust provides death and total and permanent disability assist cover automatically for its members. However, before being automatically accepted for the standard cover, members can request it by completing a form and meeting the eligibility requirements. Tailored cover is another option available, though it is subject to the insurer's acceptance and may require satisfactory proof of health. For those who do not qualify for the standard cover, they can get it through their super fund.
Long-term disability insurance is a form of death and total permanent disability insurance
Long-term disability insurance is similar to TPD insurance, but has certain differences. The disability benefits are paid according to a schedule specified in the policy, and they are paid for a specified number of months. The benefits vary depending on the policy, which may allow you to continue working part-time or with lighter duties. In certain cases, a partial disability benefit is paid if your income falls below twenty percent of your normal income.
It pays a lump sum if you become permanently disabled
What are the benefits of permanent disability insurance? Basically, this type of policy pays you a lump sum in case of permanent disability. The amount of the settlement depends on the extent of your disability and your life expectancy. Many policies pay out until age 65 or the Social Security Normal Retirement Age, but some people are unable to live up to that period. Considering this, insurance companies will try to exploit your life expectancy in negotiations. To avoid falling victim to this trap, make sure to discuss your life expectancy with a physician before taking out the policy.
It provides income protection
Income protection insurance is a type of insurance that replaces a portion of your salary in the event of your total disability or death. These policies can be negotiated and paid out to your surviving spouse, children, siblings, executor, or any other person named on the policy. These policies cover up to 85% of your salary or 10% of your super. These benefits are paid out monthly or yearly, and you can increase the level of cover as required.
It is available through super funds
Insurance cover provided through a super fund is typically less expensive than obtaining individual insurance. Insurance premiums are paid from the super balance and after-tax income. As such, the super balance must be sufficient to cover the premiums. In addition, additional contributions to super may be required to ensure that retirement savings are not depleted too early. However, not all super funds offer this feature. Here are some of the features that are worth considering when assessing insurance cover through a super fund.
