Many superannuation funds offer income protection to their members. This insurance offers peace of mind and usually pays 70%-85% of your income if you get sick or injured and need to take some time off work.
Millions of Australians are likely to pay for life insurance, such as income protection, and not even know it.
Having multiple super fund accounts means that you could be losing a substantial portion of your balance to account management fees and insurance.
Here's a quick rundown of the maximum cover limits of some leading providers in Australia:
| Provider | Maximum monthly cover |
|---|---|
| Bendigo Bank | Up to $20,000 a month or 85% of your salary (whichever is lower) |
| Zurich | $30,000 |
| Suncorp | $25,000 |
| AustralianSuper | Up to $30,000 a month or 85% of your salary (whichever is lower) |
| BT | The greater of the income ratio and 75% of monthly earnings |
| ClearView | $30,000 |
| MLC | $60,000 |
| TAL | $12,000 |
| Westpac | The greater of the income ratio and 75% of monthly earnings |
For Brenton Tong, it's worth looking into fully-underwritten income protection to help ensure you've enough insurance for your needs.
Tong commented: "Once you start looking into it in detail, a fully underwritten policy you've selected through thorough research is likely to give you much better value for money."
With that in mind, Finder has identified 3 brands that will currently offer $500,000 of income protection cover for under $100 per month.
These were NobleOak ($63.56), Bendigo ($83.55) and Medibank ($84.15) respectively. What you'll actually pay will vary depending on your personal circumstances.
This is the highest possible benefit you'll get while off work and on a claim for your insurance.
Some insurers will cover up to 70% of your income. Some providers, such as Aspect, go as high as 85%.
This is the maximum length of time you'll be able to claim benefits while you recover. It varies from 2 years, 5 years and up to the age of 65.
This is the age at which you will no longer be able to renew your policy. For most insurers, this is when you reach 65 years of age.
You'll need to prove your recent earnings, often for the last 12 months. Under indemnity value policies, the amount you're insured is a percentage of your salary at the time of making a claim.
Policies where you could "lock in" the amount you wanted to receive each month during your application are no longer available for new applicants of income protection.
This type of policy will cover you only if you can't return to the workforce in any job that's suited to your education and training.
This type of policy pays out if you're unable to work in your usual occupation or profession (i.e. the job you have currently been working in).
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