Insurance in Super

What insurance do you have in your superannuation fund?

Gone are the days when you were stuck with the default insurance, provided by your industry or retail superannuation provider. Fully underwritten insurance cover is not just for people with Self-Managed Super Funds.

Many superannuation members do not know how much insurance cover or what type of insurance cover they have in their fund, and most do not know what premiums they are paying. Sequoia Asset Management can help you set up a tailored superannuation policy that can be paid for from your existing superannuation fund.

Sequoia Asset Management acts as a broker, enabling us to provide unbiased general advice and find you the best cover, regardless of the insurer. We can also help to explain the pros and cons of holding Life, TPD and Income Protection in super versus outside of super.

Most default superannuation funds whether they are retail, industry or government super funds, have default life insurance, total and permanent disability cover and income protection. However, the default cover amount might not be right for you, potentially leaving you underinsured or even over insured and paying too much in premiums. Take a look out our Insurance Adequacy Calculator for an estimate of how much cover might be right for you.

What else you should you know?

  • Having your superannuation paid out of your super will not affect your day-to-day cash flow.
  • Having cover in your superannuation may also be easier to manage, as premiums are automatically deducted.
  • Having insurance inside superannuation may make ‘claim time’ longer, as when the insurer pays the benefit to the super fund first, the insured person has to meet a condition of release to withdraw the payout.
  • Income protection insurance, held outside of superannuation should be tax deductible at your marginal tax rate so it is worth considering whether or not you hold income protection inside or outside of super.
  • Income protection inside super is often an inferior product to income protection outside super. It is possible to have the best of both world’s though with the bulk of the premiums being paid for in super and a small amount outside of super. Ask us how.

Get in touch today to talk about insurance in super and to get a quote.

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