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You can afford insurance May 23, 2012

Posted by Meike Suggars in Personal Insurance, Superannuation.
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In 2010, a study by Lifewise found that 95% of families didn’t have adequate levels of insurance. One in five families are likely to be impacted by the death of a parent, a serious accident or illness that renders a parent unable to work; The typical Australian family will need to cope on half or less of their income as a result of underinsurance.*

With so many families without adequate cover, unexpected financial pressures on top of a serious heath event can put significant strain at a very difficult time.

Understanding their finances are one of the main reasons Australians fail to protect themselves and their families. How can I afford the premiums? Here’s how.

Insurance cover through super

Did you know that you can pay your insurance premiums through your super? This may assist you with paying insurance premiums when you have a low disposable income.

Other ways to pay for cover

You can make contributions to your super fund and gain tax benefits:

  • If you’re eligible to salary sacrifice to super, you can have premiums paid from pre-tax dollars. And because your super fund may be able to claim a tax deduction for the premiums, you may not need to pay tax on the contributions.
  • If you’re self-employed, making a personal contribution to super from after-tax income to cover premiums lets you claim a personal tax deduction.

You could also:

  • take advantage of tax offsets of up to $540 by making a super contribution to your low-income spouse
  • make personal contributions to super, and if eligible, qualify for a Government co-contribution of up to $1,000.**

 Be aware – get the right advice

  • A benefit payment under superannuation is paid to the fund trustee. The trustee will only pay benefits to you or your beneficiaries if you meet a superannuation condition of release.
  • Tax on death benefits is determined by who receives the benefits. You may need to ensure a binding death nomination is in place so that benefits are paid to those intended.
  • Paying premiums from superannuation may erode your retirement funds so think about topping up your super fund when you’re able.

To take the first steps to getting the right cover for you call your financial adviser or Contact us today

 

This information was prepared by AIA Australia Limited (ABN 79 004 837 861 AFSL 230043), it is current at the date of this document and may be subject to change.  This information does not constitute financial, legal, medical or other advice and is provided for general informational purposes only, without taking into account your objectives, financial situation, needs or personal circumstances, and may not be exhaustive.  Please consult a financial adviser before making any decision in relation to any financial product.  While this information is believed to be accurate, AIA Australia expressly disclaims all liability for representations or warranties, expressed or implied, contained in, or for omissions from, this information.


[*]  Lifewise/ NATSEM underinsurance report 2010

[**] Eligibility for the co-contribution applies. The Federal Government has proposed to reduce this to a maximum co-contribution of $500 from 2012–13.

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Looking down from heaven March 16, 2012

Posted by Meike Suggars in General, Life Insurance, Superannuation.
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For many of my clients, life insurance is the first type of personal protection they consider – usually when purchasing a property or starting a family. If you provide financially for members of your family – either children, siblings or parents – it’s likely that term life insurance will form a key part of your Personal Protection Plan.

It’s also likely that you’ll want your dependents to have access to insurance monies as soon as possible; after all, bills still have to be paid even if you’re not here.

Looking down from heaven

Looking down from heaven – would you be happy with what you saw?

To speed up the payment of insurance benefits, consideration should be given to the use of binding death benefit nominations if the life insurance policy is held within superannuation. AMP’s claims experience indicates that using a binding death benefit nomination instead of a non-binding nomination on average reduces the time taken to settle the claim by 60 per cent.

A valid binding death benefit nomination can also be useful in reducing the likelihood of protracted legal disputes over the proceeds of a will.

There are restrictions on who you can nominate as beneficiary of a binding death benefit nomination, and there may be tax implications so it’s important you talk to your financial adviser or contact Suggars & Associates to ensure your life insurance is structured in the most effective manner for your personal situation.

The advice in this article is of a general nature only and does not take your personal circumstances into account. You should seek financial advice before making any investment or financial decisions

Photo courtesy of karindalziel

Getting advice might mean you have to change… September 27, 2011

Posted by Meike Suggars in General, Investments, Personal Insurance.
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Apparently its human instinct to resist change, and many of us do so by defending the status quo, as Seth Godin discusses here

Often, we don’t like seeking advice because we know we’re going to be told to do something different. So instead we:

  • Consider the cost of switching before considering the benefits? “I can’t afford it right now” As well as the peace of mind offered by a quality Personal Protection Plan, added benefits such as tax deductibility and loyalty bonuses are often overlooked.
  • Highlight the pain to a few instead of the benefits for the many? A few dollars out of your pocket can protect your partner, your kids, and even your parents (I’m often told “my parents will look after me”)
  • Exaggerate how good things are now in order to reduce your fear of change? “I don’t need it – I’m young and healthy” Do you think the Victorian marathon runner that got caught in the WA bushfire had that on her list of “things that might happen to me”?!
  • Undercut the credibility, authority or experience of people behind the change? Insurance advisers are one of the least trusted professions, down there on the list with car salesmen!
  • Grab onto the rare thing that could go wrong instead of amplifying the likely thing that will go right? How often have I been told “Insurance companies always get out of paying”? when in actual fact last year a total of $3.5billion was paid to Australians by life insurance companies
  • Fight to retain benefits and status earned only through tenure and longevity? “But I’ve had this policy in place for 15 years” in which case, it’s probably out of date and there might be something better on the market.
  • Slow implementation and decision making down instead of speeding it up? “I need to talk to my wife and think about it” If you went home and said “Darling, I’ve arranged for you to receive $2million if I die prematurely so you can afford to stay in the house and keep the kids at school”, what do you think she’ll say? NO??!

Are you one of the many that has been thinking about looking into personal protection but have been defending the status quo and coming up with reasons to put it off or not bother? Well, the best way to go about it is to talk to a professional adviser.

Sure, you can find information online, but are you really comparing apples with apples? An adviser will know all the tricks of the trade to get you the right cover and the best price, and make the whole process hassle free.

 To find a local adviser, visit the Association of Financial Advisers website or contact Suggars & Associates for a confidential chat about your circumstances.

The Impact on Kids September 27, 2010

Posted by Meike Suggars in Life Insurance, Personal Insurance.
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This week I attended the funeral for a close friend’s dad. It was so sad to think of all the things that my friend won’t be able to share with his father – big things like the birth of his first child, and little things like watching the Grand Final together on TV.

I can only imagine how devastating it must be for a young child still dependent on their parents for the day-to-day things, with a whole lifetime stretching out in front of them, to lose a mum or a dad. Pretty scary I’d think.

Imagine how much scarier if their parent’s death leads to financial instability which meant they have to change schools and/or move house? Not only have they lost one of the most important people in their lives, they’ve lost the familiar routine of life that should be there to help prop them up during this time of intense emotional loss.

After surveying over 1000 Australians, ING has recently released its “Picking up the Pieces” report. Among other things, key findings from the report show the impact on kids after losing a parent when adequate provisions have not been made, include:

Of the children who had to change schools due to financial pressure:

  • 69% suffered from diagnosed clinical depression
  • 75% suffered from depression, anxiety or panic attacks
  • 78% said their academic performance suffered

Of the children who had to move house due to financial pressure:

  • 73% said that their family was unable to support them as much as they would have if a parent hadn’t passed away
  • 64% said their academic performance suffered
  • 64% saw their involvement in school activities decline

Image courtesy of Roland Tanglao

Parents do so much to give their kids the best possible opportunities in life – whether you think about the folate supplements during pregnancy, the pureeing of carrots into baby food, getting up early on frosty Saturday winter mornings for football training, or staying up late to help finish last minute essays – so make sure those opportunities can continue if they suddenly have to deal with death sooner rather than later.

By putting adequate life insurance in place, parents can protect the financial security of their children in the event of their own premature death. Talk to your insurance adviser or contact Suggars & Associates to review your insurance needs so your children don’t become a statistic.

You can read more about the ING survey here.

The advice in this article is of a general nature only and does not take your personal circumstances into account. You should seek financial advice before making any investment or financial decisions.

Billion Dollar Legs August 11, 2010

Posted by Meike Suggars in Income Protection, Personal Insurance.
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Would Marlene Dietrich have had the same success without that same husky, sexy voice? What about Bruce Springsteen? Imagine he damaged his voice box and could no longer sing. What would Michael Flatley do if he injured his legs in a car accident and could no longer dance?

Suddenly these people would no longer be able to do what they do best – that which also funds their lifestyles and their futures. So, they have had the sense to take out insurance on what some would describe as their most valuable asset.

Flately’s legs are insured for $25 million. Springsteen followed Dietrich’s $1 million lead and insured his voice for $6 million. And after winning a Gillette competition for the “Legs of a Goddess” in 2006, Mariah Carey insured her pins for a cool $1billion. Yes, $1billion. If she injured her legs, any potential income from future endorsements or advertising deals could be lost so this insurance protects her financially.

Billion Dollar Legs

Photo courtesy of Massimo Barbieri

What about you? What would you do if you were injured or became ill and couldn’t do your job? How would you fund your lifestyle? Would you be compensated for the potential loss of future income?

While insuring body parts is perhaps not feasible for most of us, insuring your income is a very affordable option and protects your most valuable asset – your future income.

Income Protection insurance will pay you up to 75% of your insured pre-disability income if you can no longer work due to illness or injury for an extended period,* providing continued financial security. The last thing you want to worry about while recovering is how you’ll pay the school fees, or the mortgage – or the consequences if you can’t.

For advice on the best way to protect your financial security, talk to your insurance adviser or contact Suggars & Associates.

*Conditions apply to income protection insurance, and will vary from policy to policy. Your insurance adviser should discuss these with you so you understand your options.

You can read more about celebrities insuring their body parts here.

The advice in this article is of a general nature only and does not take your personal circumstances into account. You should seek financial advice before making any investment or financial decisions.

Ladies! Life Insurance protects your highest priorities March 29, 2010

Posted by Meike Suggars in Disability Insurance (TPD), Income Protection, Life Insurance, Personal Insurance, Trauma Insurance.
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A new survey conducted by SheSpot shows career is not the number one priority for Australian women. For 74% of women, that number one priority is family, followed in second place by financial security. In fact, 62% of women surveyed are worried about money and claim it’s the number one thing making them unhappy.

I wanted to know how many women have personal insurance in place to ensure their family and financial security is protected in the event of illness or injury?

The Suggars Family 1983

The Suggars Family 1983 - the way we were

As reported by RiskInfo, it’s been revealed in the recent Lifewise/NATSEM Underinsurance Report that one in 5 working age parents will die or become seriously ill or injured, however 95% of families don’t have adequate insurance in place to protect them from the potential financial hardship that often follows such circumstances.

Are you one of them?

If you are, it’s easy for you to take control now while you’re still fit and healthy by taking out personal insurance. 

  • Income protection pays you 75% of your income if you’re unable to work for an extended period due to sickness or injury. Learn more about income protection
  • Trauma insurance pays out a lump sum if you’re diagnosed with one of over 40 illnesses including cancer, heart disease and stroke. Some policies even cover serious pregnancy complications.
  • Total & permanent disability (TPD) insurance is the only insurance to cover permanent disablement caused by mental disorder (including stress) and muscular skeletal injuries.
  • Death cover is often called Term insurance. This pays out in the event of death, and is just as important for mums as it is for dads as it can be used to pay for a nanny/house keeper who’ll iron the shirts, make sure the kids sports gear is packed on Tuesdays and that homework is done on time.

These different types of insurance can be combined to provide you with the cover you need, based on your personal circumstances. So don’t gamble with your family’s future. Contact Suggars & Associates to find out what insurance options are available to you.

The advice in this article is of a general nature only and does not take your personal circumstances into account. You should seek financial advice before making any investment or financial decisions.

What happens to your income if you can’t work? March 9, 2010

Posted by Meike Suggars in Income Protection, Personal Insurance.
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This is a question that most people don’t ask themselves until it’s too late – they’ve been diagnosed with a traumatic illness or have had a serious accident that means they’re off work for an extended period.

The obvious answer is if you can’t work you lose your income. The bills start to mount up, and so does the stress – instead of focusing on getting better, you’re worrying about how to pay the mortgage repayments, or pay the school fees.

But there is an alternative.

Income Protection Insurance allows you to protect your income from the risk of illness or injury. After being off work for a specified waiting period, you can make a claim and the insurance company will pay a monthly benefit equivalent to 75% of your income – in many cases, until you’re able to go back to work.

There are a number of different income insurance policies available from a variety of insurance companies, and different policies suit different people depending on their occupation and employment status. The amount of cover you need will depend on your financial obligations and there are many optional extras. Talking to an insurance adviser with access to a variety of products in the market, such as Suggars & Associates, will help you understand your needs and find the best policy available to suit your circumstances.

Like any personal insurance, the best time to take out income protection is while you’re fit and healthy to avoid paying loadings that may apply if you’ve already been diagnosed with a medical condition. Once you have your income protection in place, it remains in force for as long as you continue to pay your premiums – so no matter what happens to your health in the future, you’re protected from losing your income.

The moral of the story? Don’t wait until it’s too late! Protect your income and your lifestyle, and that of your loved ones, by making sure you have adequate income protection insurance. Contact Suggars & Associates to make an appointment and get covered.

The advice in this article is of a general nature only and does not take your personal circumstances into account. You should seek financial advice before making any investment or financial decisions.