Frequently Asked Questions

Life insurance is often about protecting the people you love. Whether it’s your children, your partner, or even your business, it can provide financial support if the unexpected happens. Some use it to help cover mortgages, education costs, or to leave a legacy.

A lot of people rely on the default cover inside their super fund—but it’s worth checking if it’s the right amount, and whether the definitions meet your expectations. We help people understand what they have, and what else is out there.

It depends on the insurer and the type of condition, but many people are surprised by what’s possible. We work with clients to explore available options and how different health histories may be considered.

Yes—certain types of insurance, like Life,TPD and Income Protection can be paid from a self-managed super fund. This can make it easier to manage cash flow while still keeping protection in place. We can help you understand how that works.

Here’s a simple overview:

• • Life cover: Pays a lump sum to your loved ones if you pass away.
• • TPD: May pay out if you’re permanently unable to work due to injury or illness.
• • Trauma: Covers specific serious health events like cancer or heart attack.
• • Income protection: Pays a portion of your income if you can’t work for a period of time.

That’s exactly what we help you work through. We’ll walk you through what’s available, how each option works, and help you think through what may be worth considering for your stage of life, your family setup, or your work situation.

We’re here to help. If something happens, we assist with paperwork, communication with the insurer, and following up—so the process is as smooth as possible during a difficult time.

Life insurance provides a lump sum payment to designated beneficiaries if the policyholder dies or becomes terminally ill.
This amount can be used to pay off debts, cover daily living expenses, and maintain the family's desired lifestyle beyond basic necessities.
With life insurance, you can be assured that your loved ones will be financially protected and secure in the event of your untimely death.
If you have dependents who rely on your income, either fully or partially, to pay household bills and other expenses, then life insurance may be right for you.

First, consider what your family and loved ones would need to maintain their current lifestyle and avoid financial hardship if you were to pass away or be diagnosed with a terminal illness.
The amount of life insurance coverage you need depends on various personal factors, including your age, income, dependents, debts, and lifestyle.
Ensuring you have adequate coverage is essential to protect your loved ones in the event they need to make a claim.
As the primary provider for your family, you are likely responsible for expenses such as mortgages, loans, school fees, and daily living costs.
These expenses can quickly add up and cause significant stress if your loved ones cannot cover them in your absence.
It's important that your life insurance coverage not only meets your family's immediate needs but also considers their future requirements.

Life insurance, Total and Permanent Disability (TPD) insurance, and Income Protection insurance can all be funded through either a retail Superfund or a self-managed super fund (SMSF).
Opting to pay these insurance premiums through Super grants you a 15% tax rebate.
If you already hold insurance through your Super, we can conduct a thorough review to ensure its alignment with your requirements.
Our objective is to ascertain that you have the appropriate coverage to safeguard both yourself and your loved ones.

Underwriting is the process where insurance companies assess a customer's eligibility for insurance products.
In the realm of Life Insurance, two key components are considered: medical underwriting and financial underwriting.
This includes answering inquiries regarding your health, family history, financial history, details about your occupation and participation in sports or recreational activities.
While medical examinations may not always be required, they are only requested to aid in the evaluation process.
All information provided for medical underwriting and financial information is strictly confidential.

Having a pre-existing medical condition doesn't mean you can't get life insurance.
Each application is reviewed individually by the respective underwriters to understand the risk involved and the cover options.
Insurers may offer coverage by adjusting your premium or excluding certain conditions, rather than denying you outright. It's important to answer all questions truthfully to avoid issues when making a claim.
Insurers consider personal factors such as age, health, and lifestyle before approving your application.

When you take out life insurance, you can choose between two premium structures: stepped or level. Each has its own advantages and disadvantages, and the best choice depends on your personal circumstances.

Stepped Premiums:
How it works: Premiums increase annually as you age, reflecting the higher risk of claim.
Who it suits: Those looking to save on initial costs or needing insurance for a shorter term.
Pros: Lower initial premiums; suitable for short-term insurance needs.
Cons: Can become very expensive over time, especially in older age when coverage is most needed; less cost-effective over the policy's life.

Level Premiums:
How it works: Premiums are more evenly spread over the policy's duration, based on your age when you start the policy. Often transition to stepped premiums after a set period (e.g., post-65).
Who it suits: Those seeking long-term coverage with more predictable costs.
Pros: Potential savings over the policy's life; more consistent premium budgeting; ideal for long-term reassurance.
Cons: Higher initial costs; eventual transition to stepped premiums may reduce long-term savings.

Considerations for Both:
Premiums may change if the sum insured changes due to voluntary increases, indexation, or insurer rate changes.
Government charges (e.g., stamp duty) can also affect premiums.

Summary:
Stepped Premiums: Lower initial costs, higher long-term expenses.
Level Premiums: Higher initial costs, potentially more economical over time with better long-term budgeting.
Regardless of the premium structure, your insurer may adjust premiums due to factors like government legislation changes, operating costs, or commercial viability.

Income protection is a type of insurance policy that provides financial support if you are unable to work for an extended period due to illness or injury.

It offers a regular monthly benefit, typically up to 70% of your income, for the duration specified in your policy.

This type of insurance is crucial for sole income earners, regardless of whether you have dependents.
If you do have people relying on your income, it helps alleviate the financial stress for both you and your loved ones if you become ill or injured and unable to work.

By having income protection in place, you can ensure that you and your family can maintain the lifestyle you've worked hard to achieve, even in the face of unforeseen health challenges.

You can make a claim on your income protection insurance if you are sick or injured and unable to return to work for a period that exceeds the waiting period specified in your policy.

You may need to provide evidence to confirm that you meet the insurer's definition of being unable to work.
The specific illnesses and injuries covered, as well as their definitions, will vary between policies.
Coverage can range from minor injuries like a broken bone to major health events like a heart attack, depending on your occupation.

It is important to thoroughly review the product disclosure statement to understand exactly what is covered and what is not.

No, income protection insurance does not cover redundancy or job loss.
It is important to understand that the basis of income protection is the inability to work due to illness or injury,
and redundancy does not constitute an inability to work, hence it is not covered.

TPD insurance provides a lump sum payment if you become totally and permanently disabled due to illness or injury and cannot return to work.

Often bundled with life insurance, TPD insurance ensures coverage for you and your family in the event of death or serious injury but can also be purchased separately.
If illness or injury permanently prevents you from working, your TPD policy will pay a predetermined sum to help cover ongoing medical costs, debts, mortgage repayments, household bills, and other expenses, safeguarding your family's future lifestyle.

Additionally, TPD insurance can cover costs related to care, rehabilitation, and home modifications needed as you adjust to your new situation.

The amount of total and permanent disability (TPD) coverage you need depends on various factors, including your current income, future expenses, debts, and dependents.

Consider your current income: Could your family manage without it? Even if you don't have an income, being permanently disabled can significantly impact your ability to perform tasks like childcare, driving, and cooking.
TPD coverage can help alleviate the financial burden if you become permanently disabled.
If you have children, think about their future: Will you be able to afford their education if you can no longer work?
Also, consider your debts and mortgage repayments: If you rely on your income to cover these bills, will you be able to pay them if you are unable to work? Rehabilitation costs can be substantial.

While health insurance may cover some of these expenses, it's essential to compare policies to ensure you're not left with significant out-of-pocket costs when you need it most.
Each insurer defines total and permanent disability differently and offers coverage for different situations.
Therefore, it's crucial to understand what is and isn't covered before purchasing a policy.

At Finsol, we can guide you to ensure you adequately protect yourself and your family based on your unique situation.

When you take out a Total and Permanent Disability (TPD) policy, it will be classified as either Own Occupation or Any Occupation.

It's crucial to know which type you have, as it affects your eligibility for a payout.

Own Occupation: Pays out if you become permanently unable to work in your specific occupation at the time of the claim.

Any Occupation: Pays out if you become permanently unable to work in any occupation that matches your experience, education, or training.

Example: Meet Kat, a mechanic who severely injures her arm and can no longer work in her trade.
Own Occupation: Kat can claim on her TPD policy because she cannot return to her job as a mechanic.
Any Occupation: Kat can only claim if she is unable to work in any job suitable for her skills, experience, and training.
If Kat previously worked in a call centre, her claim might be denied if she can still perform that job.

The key difference is that an Any Occupation policy has a higher threshold for claims, as insurers may consider you fit for other work based on your qualifications and experience.

When you take out trauma insurance, your insurer will provide a lump sum payment if you are diagnosed with a specified illness or injury that significantly impacts your life, such as a heart attack, stroke or cancer.

An unexpected diagnosis of a serious illness or an injury can hinder your ability to work and provide for yourself and your family.
The lump sum payment from a trauma insurance claim can offer substantial peace of mind during such challenging times.
This set amount can be used for medical bills not covered by your health insurance, debt repayments, transportation costs, additional care needs, and everyday expenses.

Always carefully read your Product Disclosure Statement before purchasing trauma insurance to ensure you understand which illnesses and injuries are covered, as this will vary between insurers.

Most providers include more than fifty conditions in their trauma insurance policies. While the specifics can vary among insurers, the following illnesses are typically considered traumatic and are often covered:

- Heart attack/Heart disease
- Stroke
- Most types of cancer
- Neurological diseases, including Alzheimer's Disease Severe anxiety and depression
- Major organ damage/transplant
- Multiple Sclerosis or Parkinson's Disease
- Severe diabetes
- Medically acquired HIV
- Meningitis or meningococcal disease
- Loss or paralysis of a limb
- Severe arthritis
- Deafness or loss of speech
- Major head trauma
- Major burns Injuries from major accidents

Although this list might seem limited, these conditions are quite common. According to the Heart Foundation, heart disease is the leading cause of death in Australia, and one in two Australians will be diagnosed with cancer at some point in their lives. Additionally, cerebrovascular diseases, such as strokes, and conditions like Alzheimer's and dementia can severely impact your ability to work.
While it’s not pleasant to consider, trauma insurance covers the conditions most likely to cause sudden incapacity or death. It’s crucial to read the Product Disclosure Statement (PDS) when researching policies to understand exactly what is covered and to determine whether a provider is right for you.

It's a common question and can be confusing, so let's break down the different types of insurance.

Trauma insurance is primarily designed to offer a short-term cash buffer if you need to take time off due to a serious injury or medical condition. It provides a single lump sum payment intended for immediate financial relief. This lump sum can help cover your mortgage or support your family while you’re ill, alleviating immediate financial stress.
Income protection insurance provides regular payments, typically up to 70% of your income, for a set period while you're temporarily unable to work. It offers longer-term financial support but can take longer to pay out.

Total and permanent disability (TPD) insurance offers ongoing payments if your illness or injury prevents you from ever returning to work. It covers many of the same conditions as trauma insurance but is focused on long-term financial needs.

In summary, trauma insurance offers immediate financial relief through a lump sum payment, while income protection and TPD insurance provide longer-term financial support through ongoing payments. It’s common for people to bundle multiple life insurance policies together.

For example, if you're covered by both trauma and income protection insurance, you can use income protection to cover day-to-day living expenses while the trauma payout may be used to cover any gaps in medical expenses or to allow your partner to take unpaid leave from work.

When taking out trauma insurance, you should consider a coverage level that compensates for any lost income while you recover.

To estimate the amount you need, think about how you would cover the following expenses without your regular income if you couldn’t work: Mortgage repayments Credit card debt School fees Medical expenses Household bills