Published: 23 September 2016
Author: John Cramp

Ask yourself "Will I have enough income if I get injured and can not work again?"

As lawyers, we see the harsh realities and impact of illness and injury on a regular basis. Just as you insure your home and your car, it’s equally important to insure yourself in an effort to safeguard your future.

Nobody plans to get terminal cancer or a lifelong disability, however those who plan for permanent disability insurance, income protection and life insurance will certainly manage better than those without it.

Taxes, death and insurance are all subjects we’d prefer not to talk about. Yet, attention to the fine print in insurance policies can be life changing for loved ones and ourselves. At Stringer Clark, our experience is all too often people think they’re covered, but they’re not.

Did you know that being a member of a superannuation fund often covers you for disability insurance if you are too ill or injured to work? Many people are unaware this insurance coverage is available to them as it can be hidden in the fine print. Alternately, we regularly see cases where people have spent years paying high insurance premiums, and when they need to access these funds, the insurer denies access due to "a technicality".

Questions to ask your insurer about the fine print

For peace of mind, we encourage all Australians to know the answers to each of the following questions to ensure they have the right coverage for their personal circumstances. If not, ask your insurance company about your policy.

  • If my income stops (due to resignation, redundancy or maternity leave), am I still covered?
  • If my super balance changes, am I always covered?
  • If I return to work after an injury or have received workers compensation from my employer, am I covered?
  • In the case of injury, what are the waiting periods for compensation?
  • If I am taking time off work due to an injury, how soon must I see a doctor for treatment to ensure I am covered?
  • What pre existing illness or injury do you need to know about?
  • What jobs and extreme sports are not covered under this insurance?
  • How much will my income protection pay and for what period?
  • Does my insurance lapse if there is not regular income added to the fund?

An hour or two of research can make all the difference

Being unable to work due to illness or injury is life changing for families and the fine print in an insurance policy can make a significant difference. Be sure to check all your insurance policies, including your superannuation fund. In addition, it is wise to seek legal counsel BEFORE making an application as the initial application is vital to the process, and can be significantly more difficult and expensive to rectify at a later date.

If you cannot manage the costs of additional insurance, consider having the payments transferred directly out of your super on a monthly basis. This way you will not need part with cash for your monthly payments and you’re covered for the future. When determining how much insurance you need, be sure to calculate your annual cost of living, and cover yourself and your loved ones accordingly with life insurance and income protection.

For further information on how to best protect yourself and your family, book an initial consultation with Stringer Clark today.

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