Is your Personal Insurance Adequate?

The purpose of personal risk insurance is to maintain your lifestyle and financial prosperity when something goes wrong.  There are several types of health risks that you should consider but there is only one outcome that is important.  That is, to have the right amount of money delivered to the right person at just the right time it’s needed.

You already know that things go wrong in life, so ask yourself these questions:

  1. “If I die before my time, where would the money come from to keep the house, pay the bills, as well as raise and educate my children?”
  2. “If I had a serious accident and could never work again, could I / we get by for the rest of our lives with added costs of rehabilitation?”
  3. “If I developed cancer, could we afford the one or two years of out-of-hospital (out-of-pocket) treatments that most recoveries entail?”

When you arrive at a realistic answer, check your super to see how much insurance you have there.  It probably won’t be nearly enough.

According to Canstar, 83% of people sign up for the default cover in their super account.  The amount of cover is typically low.  Superannuation statistics published by ASFA in December 2016 indicate that average super account balances in 2013-14 year were around $98,500 and $55,000 respectively for males and females.

This means that the average lump sum payout for a death or total & permanent disability insurance claim would be the equivalent of about one or two years of income at best.  And it won’t help at all to pay your way through the early years of a serious health trauma such as cancer, heart surgery or stroke.

If you think you can’t afford insurance, consider increasing your insurance in superannuation.  The premiums are automatically paid from your super account.  Although this will have a slowing effect on your retirement savings, it’s a compromise that can help a lot with the family budget, particularly during the expensive years of home making and child raising.

Call me direct on 0408 756 531 for a free appointment.

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Three (3) Tips on Personal Insurance

There are some serious misconceptions out there about personal risk insurance.  Take it from one who knows that all that glitters is not gold when it comes to insurance.  The super-convenience of over-the-phone, immediate instant sign-up, direct insurance with no medicals may lead to disappointment later on if you don’t read the fine print.  Here are three (3) ‘behind the scenes’ tips if you are thinking about insuring yourself or your family.

  1. Buying personal insurance cover direct from an insurer can mean paying higher premiums, compared to similar cover purchased through an adviser. Direct insurers generally charge standard premiums to everyone instead of asking each individual for full health disclosure up front.  Depending on your age and health, it may be more expensive because the insurer has to build into the price the higher risk of not knowing who is healthy and who is not.  However, they are guided by fairly accurate ‘group statistics’.  But here is the catch!  If they don’t ask questions when you apply, they certainly will ask questions, and lots of them, whenever you make a claim.  And that’s precisely the time you don’t need the hassle.  If you don’t read the contract which most people don’t, it is then you will discover the policy exclusions, and may find that after paying premiums for years, those health issues you already had when you bought the policy are not covered.  You may even find that, as you get older, the amount of cover you originally bought reduces over time.  That means if you do make a successful claim, it may be a lot less than you expected.
  2. Insurance purchased through an adviser usually gets you a policy that is better tailored to your needs. Good advisers explain the important parts of the contract, especially what is not covered.  From the time your application is received by the insurer, you have interim cover and a cooling-off period.  And importantly, if you make full and honest disclose of your medical history during the up-front underwriting process, any valid claim that falls within the scope of the cover will almost certainly go through.  If you have a health problem now or in the past, the insurer will make it crystal clear to you at the start whether exclusions or other conditions apply.  You can also rely on good advisers to help you with your claims process, and they can help clarify if you are unsure whether you have a claim that is covered by your policy.
  3. Let me bust a big myth here! Almost nobody is required to have an insurance medical exam these days.  The reason is that if the insurer requests an examination or any test, the insurer has to pay for it.  What really happens is that you disclose your medical history, either in your application or over the phone to a qualified nurse contracted by the insurer.  From there, the insurer will probably request your medical records from your doctor(s).  You give that permission in your application.  Depending on your history, they might ask for a blood test.  Insurers have their own qualified medical testing contractors and your adviser will arrange a qualified nurse to visit you at a convenient time and place at no cost to you. For most people, that’s it.  However, be aware that your BMI (weight to height ratio) is a big deal to insurers.  A BMI of 30 or over will limit your insurability because of a range of health risks that obesity brings.

If you want to talk to me about personal risk insurance, I am happy to have a chat and answer questions over a cup of coffee, obligation-free.  You can also get a good handle on cost before you start with comparative quotes from two or three insurers that are likely to best suit your specific needs.  If you decide to proceed, you can choose to pay by fee from your own pocket or by way of commission paid directly from the insurer to my licensee.



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Business management tips – risk insurance

9 myth-busters on personal insurance in Australia

Business management tipsYou hear it almost every night on TV.  Buy insurance direct and avoid the unwanted medicals.  Well here is the other side of the story – some business management tips, and tips for all individuals considering insurance.  When you purchase personal risk insurance through a licensed adviser, you will have a product recommended to you that suits your needs.  You will also have someone to explain the fine print to you, and to arrange everything for you.

So here is what really happens when you seek advice from an insurance adviser in Australia:

  1. Very few people are required to have a full medical for insurance purposes
  2. Most policies are accepted on the strength of your medical disclosure in the application and the report from your regular doctor (you agree to that in the initial application)
  3. You do not have to go to a doctor and pay for medical testing to get insurance
  4. If an insurance company wants you to undergo any medical test, they pay for it.  Because it is an expense to them, they try to keep all medical testing to a minimum
  5. Occasionally a blood test or other test is required.  If so, a registered nurse or other qualified professional from a specialist insurance medical testing service will arrange to see you at home or at work at a time convenient to you.  It takes 5 minutes.
  6. Most insurers have a tele-underwriting service where an underwriter will talk to you about your medical history over the phone in about 20 minutes.  You don’t spend hours filling in forms.
  7. If you apply for insurance that is personally underwritten, you will get a very competitive price because the insurer knows exactly the risk you represent to them.  You will also know up front what you are covered for and not covered for.
  8. Underwriting at application stage generally means that unless you fail to disclose information or you tell a lie, you are certain to be paid at claim time.  If you are not underwritten when you first apply, you may have the insurer asking these same questions when you make a claim.
  9. Insurance medical testing saves lives.  Many people have had their lives saved by finding out through an insurance requested blood test that they have a serious medical condition

Yes it is true that you will pay a fee to an adviser or the adviser will receive upfront and ongoing commission from the insurer.  It depends on the adviser however, every professional is entitled to be paid for what they do.  However, you will not necessarily save that cost by going direct, and you certainly won’t receive unbiased advice.

Personal risk insurance is must for business owners.  One final comment in this week’s business management tips:

“Ownership of an insurance policy is a crucial issue.  In the event of a claim, the money needs to be paid to where the protection is needed.  That could be to you the owner or your family; or to the business  (company or trust) if your business equity or a key person in your business is the subject of insurance protection.”


Make your superannuation commission free!!

Why pay an adviser you never see?


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Welcome to my financial planning & business planning Australia blog

business coaching Brisbane7 Handy hints for personal insurance

  1. Be careful buying personal insurance without advice; some cheap life insurance policies pay only if you die by accident (only about 20% of deaths are caused by accident)
  2. Unless you are personally underwritten when you apply, do not assume you are covered for pre-existing medical conditions
  3. ‘No medicals’ insurance could mean that the insurer starts asking questions to determine payment (if any) when you make a claim
  4. It is a myth that applying for insurance means having a medical. Most people are insured on the basis of their medical disclosure in the application and a report from their family doctor (you give written permission for the insurer to write to your doctor in the application form)
  5. If an insurance company wants any medical testing done (commonly a blood test if anything) they will pay for it and will arrange to send a medical professional to your door at your convenience
  6. Never assume you are uninsurable.  An insurance underwriter may exclude some insurance but not all; or exclude certain pre-existing conditions; or increase the premium to reflect higher risk
  7. If you are thinking insurance, think trauma insurance because suffering a serious illness (e.g. heart attack, bypass surgery, cancer, stroke) is statistically your most likely health event

 A good adviser will tell you what is in the fine print.  Personal underwriting and truthful disclosure when you apply is the way to guarantee you will be paid at claim time.

Call me direct on 0408 756 531 or email

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