There are a large amount of advertisements recommending you take out life cover out with automatic acceptance, and no medicals. Simply sign up and be covered in under two minutes. Sounds too easy, right?
But what issue does this pose at claim time?
When taking out individual or tailored insurance whether it be Life Cover, TPD, Income Protection or Trauma, the life insurance companies may require you have a medical exam so they know your current health position. Essentially, they are assessing you before taking your money to pay the premiums.
If you are found to be too high risk, then they will notify you and amended terms may be offered. By applying for tailored insurance and possibly completing a medical exam, you know exactly what you are covered for before handing over the money to pay for it.
Going with Direct Life Insurance with automatic acceptance on the other hand, means the medicals are done at claim time. With the chance of a pre-existing medical condition being discovered at that stage, it is then up to the insurance company to assess whether or not, if they had known about your condition at application, they would have covered you. Essentially, they are taking your money before they assess your eligibility for cover.
Would you feel comfortable paying premiums for life insurance without assessing your eligibility for cover? How annoyed would you be if a claim was denied and you had no recourse to all the funds you already paid?
To ensure you have the best possible cover to suit your individual needs, contact any of the advisers from Wealth Planning Partners on 07 5593 6895 who will be able to assist you and put your mind at rest.
A lot of our daily client queries are based around superannuation. It’s a tricky area for many clients to wrap their heads around with lots of rules, regulations, risks and opportunities.
Here’s some facts below, followed by a key hint on how you can best navigate this somewhat complex, but incredibly important wealth creation strategy. Fact 1: There are over 500,000 Self Managed Super Funds in Australia, with approximately $440 billion under management – indicating the average amount under management in each, is $880,000. Fact 2: There are approximately 1000 Self Managed Super Funds in Australia with more than $10 million in managed funds, and up to 6,000 with between $5 million and $10 million. This means that there are a lot of funds with significantly less than the above estimated average of $880,000. Fact 3: 47% of Australian couples and 78% of singles over 40 don’t have enough funds to retire. This article explains the situation that couples in Western Australia (and the rest of the nation) need approximately $1 million in superannuation and savings to retire comfortably – a target most of us fall far short on. And with us living longer now, the risk will only become higher! A study by REST Industry Super reveals 30% of young people are hoping for an inheritance to help fund retirement; however superannuation is improperly accounted for in many people’s Estate Plans leaving family members somewhat short-changed. And with many parents now choosing to have “SKI trips” (Spending the Kids Inheritance) the odds are, there’ll be less to inherit. TIP: Superannuation is a wealth creation strategy that the informed know how to take advantage of, and many others won’t. Education is key. Many feel it’s too complex and too hard.
Our role at Wealth Planning Partners is as advisers is to assist clients with wealth creation for retirement (through investment, superannuation and insurance), but just as importantly to educate about the opportunity that Superannuation is and then how to secure this fantastic and tax effective asset for the benefit of their own retirement, and family.
We are here to support you in learning the ins and outs of superannuation and have fabulous partnerships with legal experts to assist with Estate Planning and Business Succession issues.
Give us a call to chat about your retirement issues, and ensure you start the New Year off on the right financial foot.
If there’s only thing life constantly throws at us, it’s change!
It often occurs when we least expect it and can take us by surprise. Especially when it’s the end or start of a relationship! Sometimes when emotions are running high and life is in a state of upheaval, it’s easy to overlook some of the more practical things that need taking care of.
So, here’s a bit of a check-list of things you might have missed when adding or moving on from a life partner…
Have you updated the beneficiaries of your superannuation fund? (this stays outside of your estate and isn’t usually dealt with by your Will.)
Have you updated your Will and Powers of Attorney? Or Guardians for the children?
Do you need to review your Life Insurance and beneficiaries?
Is it time to provide for you,… reviewing or establishing Trauma cover?
Does your Income Protection need updating?
Have you reviewed ownership of any joint investments and debt?
Have you removed or added secondary owners on credit or store cards?
Do your mobile phones bills need separating?
Are you guarantor for any personal or corporate loans?
Do you need to review any arrangements for family trusts or companies?
Does your health insurance need review?
Do your utility bills need amending?
Do your banking arrangements need revision – removing or adding signatories to accounts?
Do you need to let the school know changes to custody for the kids?
Do you need to review and choose new service providers like your accountant or adviser or lawyer?
Have you let everyone know your new contact details?
With so much going on it’s easy to overlook some items on the list. Or have you been through this change yourself? Let us know if there’s anything we’ve missed! There’s bound to be more!
On 1 July 2014 the cap limits for superannuation contributions were increased, allowing you to contribute more into superannuation before penalties are applied.
Concessional contribution caps apply to employers’ compulsory super guarantee contributions, voluntary salary sacrifice contributions and to personal deductible super contributions. The non-concessional cap applies to after-tax contributions.
The increase in caps are designed to assist you to save for their retirement sooner rather than later. The new contribution caps for the 2014-15 financial year are: Concessional Caps
$30,000 or
$35,000 for people aged at least 50 by 30 June 2015.
Non-Concessional Caps
$180,000 per year
$540,000 per three consecutive years (under ‘bring forward’ rule)
Taking advantage of the increase in caps now could benefit you down the track. Adding regular contributions earlier rather than later, combined with compounding returns, could boost your retirement income substantially!
Give us a call now to see if you can take advantage of any of these increases.
Warning, warning, warning, open your calendar now and lock in your insurance reviews!!!
Things have changed in your life. Change is the one big constant in this world. Some change is radical and obvious like loosing a job, or getting a promotion or getting married or having a baby or buying a house or getting a divorce.
Other change can be very covert and kind of creep up on us. Things shift and we don’t really notice. Try fitting into last summers bathers, or check the slow wear on your car tyres or the goals you set last year to stay on track with your life.
Will Rogers wrote, “even if you are on the right track, you’ll get run over if you just sit there.” That is, run over by change if you don’t stay vigilant. Any successful person in their field will confirm that to achieve your goals you need to review them daily so the creeping change that we don’t notice, does not bump you off course.
If something is important to us, we need to make sure we treat it like a priority so that the urgent things in our hectic lives, don’t steal the show. Be vigilant, diarise your priorities and review your goals daily. Protect everything you have worked so hard for and ensure that you have the right insurance to keep you on track.
Be one of the few that work smarter and not harder!
For many, getting life insurance itself can be a scary thing, but it’s not about paying premiums. As cover can at times, be funded by super, this sometimes isn’t even an issue! The idea of preparing for not being here any more, isn’t very fun however.
Most understand that protecting their family, should the unexpected happen, is an incredibly important thing to do. For some, the potential of looming medical tests may be frightening.
But firstly, not everyone needs a medical! It mostly depends on how much insurance cover is applied for. All companies have a ‘non-medical limit’: that is, if the amount of insurance you’re applying for is under their limit, you won’t need a medical at all. If you want to be insured for a sum that is over that limit, you will be told you require a medical at application time.
A bit more on the test itself… A lot of people think it could be a brutal test, specifically designed to lose undesirables.
In reality, it’s similar to a standard check-up at your doctor’s office can be less stressful when done in your own home.
The medical is used to find underlying conditions that may shorten your life or adversely affect your health and will generally consist of:
a blood test to check for health conditions (often called an MBA20)
a urine test (affectionately alluded to as the Pee Pot test)
blood pressure measurements, (lose the Lab Coat freak out!) and
in some instances, an ECG to measure heart rate.
Your usual GP can often get a copy of your results if you request these.
One thing’s for sure, you don’t need to have the body of an athlete to get life cover. And more importantly, you won’t need to worry about being denied a claim because of your health at a later date if you get all the tests done when you apply. And beyond life cover protection, it’s nice to know how you’re doing in general – and at the cost of the insurer.
The story of Noah is an old one, recently retold (and completely reinterpreted) by Russell Crowe… although I must say not retold very well! Many ancient cultures mention a Great Flood in their writings or legends. Why is it that this story has been so compelling and retold over millennia? It has to do with survival. Warnings of a great storm and the plans set in place to ride out that coming storm…
Noah had the advantage, so the story goes, of God warning him of a coming catastrophe and what he needed to do to so that he and his family could survive. The account tells us that Noah listened to the instructions, made adequate preparations and when the storm came, he and his family were able to survive.
How does this relate to our financial future you may ask? Well, we too could face huge financial storms in our lives; redundancies; life changing events; economies grow and shrink, events that often leave us exposed and vulnerable. What lessons can we take from old man Noah then?
For one thing… seek the right advice. Seek a qualified person who takes a personal interest in you. Listen to the advice and implement it. Don’t wait until the storm hits! Act immediately and make needed adjustments. Noah had never seen rain before, yet he acted on the advice given and built his Ark. He was able to keep his head above water, so to speak, while everyone else drowned around him.
His adviser also believed in diversification, two of every kind was to go onto the boat. This was good advice. Even today this is regarded as a good strategy.
So even if you have never experienced a financial storm in your own life, always be prepared for one, make sure you build your financial ark with the aid of the right advice. It could save your (financial) life!!
In our busy day-to-day activities, we sometimes overlook a very important aspect of our planning: that of protecting ourselves, and our loved ones financially if things don’t go according to the Grand Plan.
Sure we provide financially for them now, but what about the ‘what ifs’?
If you currently have insurance in place, whether its default cover inside your superannuation fund or out, tailored or not; when last did you have a good look through it? Have a few years passed since you last considered whether your insurance is still relevant or more importantly, adequate? Maybe you’ve had a few changes since you first implemented your strategy.
This brings us to the point of this article: Have you had a major life event occur? Here are just four to consider, known to Advisers as review triggers: Marriage or Separation
What happens when I Do, becomes I Don’t. Either event is a huge change to your life and when a thorough review of your financial situation is most critical. You need to assess your new financial needs, levels of debt and the need to provide some kind of protection for both parties. When going your own way, do you need to reduce cover? Update your beneficiaries? Increase personal protection? Maintain what you have until the property settlement is complete? There’s a lot to consider! New job and income changes
You may have, or need to consider acquiring an Income Protection policy. Your ability to earn an income is your most important asset. Yet most will protect their house or car before this! Without an income, our lifestyle and material possessions cannot be sustained. If things have changed, ask yourself, does your new income reflect the amount you are currently covered for, are you paying too much in premiums? Do you have an agreed value or an indemnity benefit type? Do you know what waiting period was selected? Or how long you’ll be paid out in the event of illness or accident? All these factors could have a major impact if not done correctly and you’re suddenly unable to work.
Have you been remembering to claim the premiums at tax time? New home purchase
New homes normally come with increased debt. Life insurance can cover this in the event of your death. But what if you become disabled or suffer a serious illness… how will be payments be made? What’s your Plan B? Birth of a child
With an extra mouth to feed, your family’s income needs will have changed, and your expenses too! You may want to consider saving for future education expenses, taking out child cover to provide options in the event of major illnesses, and increasing your life insurance if you’d like to provide a legacy for your family.
If you have had one or more of these triggers, don’t you think it time to take action and do your review? Contact your Wealth Planning Partners adviser now to set up a time convenient to you. We also offer in-home visits or SKYPE calls if the 9 to 5 doesn’t suit you.
Most of us have been touched by having someone we love be diagnosed with, battle or suffer with cancer. Most recently, a lifelong girlfriend of mine passed away after a 7 year fight with breast cancer, at the age of 44.
Thankfully, I’d set her up with a Trauma Policy some years before and the lump sum financial assistance she received meant she had treatment options and could explore the avenues of her choice. Although her only lament was, that she wished she’d gotten more.
Trauma Insurance provides cover for many individual events (up to 50 with some providers) which include breast cancer, and pays a lump sum regardless of whether you’re prevented from working or not. It can provide invaluable financial support, security, and importantly options for treatment, care and recovery.
Women have unique needs. As a result, some insurers provide financial protection for health conditions of particular concern to women. Almost 81% of female Trauma claims with CommInsure are for cancer, making it undoubtedly the leading cause for claims.
Listen to Susie’s story here:
If you’d like to contact one of the WPP Advisers for a review of your situation, call the office on 07 5593 6895 to talk to one of our risk specialists now.
A recent chat with a friend soon turned into a request for a review of his financial situation, as I had a bit of time over the weekend we ended up having this very important discussion.
The lack of proper financial advice soon became very evident when looking at his situation. The family home still has a substantial mortgage; and he and his wife also own an investment property, which is being serviced with an interest only loan.
The husband is 54 years old, and is the main income earner who works in a very physically demanding job.
When the simple question was put to him that should he be injured and could no longer work or worse still, suddenly pass away, in what financial situation would his wife and daughter find themselves in?
His answer staggered me, he said: “Well, my wife could go back to work and my daughter is at uni, so she still has many years ahead of her to earn an income, my family will be fine and besides, I have $120,000 in my six superannuation funds which will be more than enough for them.”
Wow,! His 52 year old wife would have to go back to work, sell the investment property which would not generate any profit at current market conditions, his super payout would not cover the amount owing on the family home and his daughter would be left without any financial legacy from her father. Besides this worrying situation, if he was injured and could not work for any length of time, this family would be in dire straits.
Unfortunately this individual has set himself and his family up for failure in the event of the unexpected. What a sad legacy to leave his family.
I explained that this situation had an easy fix and provided him with a few strategies to think about, and showed him how inexpensive it would be. One of these was rolling his super into one preferred fund and saving hundreds, if not thousands of dollars a year in fees. As an option, death cover could be funded through the super, incurring no ‘out of pocket’ expense to the family but enabling them to be debt free in the event of his premature demise.
Having left this information with my friend for a week or two, I contacted him to see if he had given his situation any further thought and if he wanted to implement any of the strategies we spoke about. Once again his answer was very disappointing, although he thought doing the super consolidation was a good idea, he still didn’t think that he needed any other insurance.
It is not amazing that most people are willing and do provide for their families when they are alive, this is who we are as humans and it is what we do. It is the nature of things. What is truly staggering though is that so many people still fail to provide for their families once they have passed away.
In the end, the choice is always ours, we can ensure our families are well cared for financially once we are gone, or we can fail them, leaving them at a time of sadness and distress with a financial burden that could so easily have been avoided.
