Insurance is designed to protect you and your family when in need. If there are individuals who depend on you for financial support or you work at home providing your family, insurance can support and protect their lifestyle if something were to happen. Whilst life insurance is the most general cover, there are more types of insurance designed to help you in specific circumstances.
Life insurance is designed to provide for your family when you pass away or are diagnosed with a terminal illness. Your family will receive a lump sum payment that can assist with financial pressures such as paying off the mortgage and other debts, providing for your children’s education and securing your family’s lifestyle. Applications for life insurance will require you to fill out information on your medical history, occupation, hobbies and lifestyle to determine risk and cover amounts you qualify for.
Income protection is a form of insurance that pays you a regular cash amount if you are unable to work as a result of a sudden illness, covering up to 75% of your income for a set period of time. You can insure your income through agreed value, where you decide the amount you wish to receive each month, or indemnity, where you prove your income at the time of claim rather than during application. You can generally claim part or all of your income protection insurance premiums that are taken outside of your super as a tax deduction, helping you save more on your tax bill. However, you are not entitled to deductions for a policy that compensates for a physical injury.
Total and Permanent Disability (TPD):
TPD insurance pays a lump sum in the event of severe illness or injury that prevents you from working again. TPD cover can be purchased on its own or added to a life insurance policy. You can use this payment to settle debts, cover medical costs and invest so you continue to have an annual income.
Trauma insurance is designed to pay a lump sum that covers medical treatment expenses that are not covered under Medicare or under private health insurance, if you were to suffer from certain medical conditions. This cover normally includes conditions such as heart attack, stroke, cancer and coronary artery bypass surgery. These conditions account for over 90% of all trauma claims.