An email from a client who is claiming trauma insurance


A client is claiming trauma insurance due to cancer. The claim forms were sent to insurance companies two days ago. The attached is the email received from client just now.

Although we have Medicare, trauma insurance is still very important in the time of major illness for good and prompt treatment.

By |October 21st, 2016|Blog|0 Comments|

The premium of a new policy

One income protection and trauma insurance policy was settled today. The monthly premium is $994.17.

You may feel the premium is high. But it is the most competitive premium after we compared ALL 11 main insurance companies and banks.

The high premium is maily because of the age. The client is 58 years old. If this policy was taken at the age of 38, the premium is only $162.27.

Besides the premium, one existing illness is not covered in the policy.

If you don’t have insurance policy, it is better for you to have one as early as possible. When you are old, the premium is high; when you are unhealthy, the insurance may be unavailable.

By |October 21st, 2016|Blog|0 Comments|

Commonwealth Bank of Australia introduces reforms to tackle alleged misconduct

The Commonwealth Bank of Australia has told the Senate it has introduced new reforms to tackle alleged misconduct in its insurance branch.

This comes following a stoush over CBA chief executive Ian Nerve’s no-show at the hearing who is believed to have told the committee that he and other bank executives were unable to attend due to insufficient notice.

CBA also gave its side of events regarding the vexed sacking of CommInsure whistle-blower Benjamin Koh.

CBA’s submission lodged with a Senate committee claimed that out of the five CommInsure customers being discussed, that two had been paid before this year and another two had been paid after a review and the final claim had been “consistent with the policy.”

The misconduct allegations which revolve around alleged tampering with medical reports and denial of claims based on old medical definitions were brought to light last month by former chief medical officer Benjamin Koh.

Dr Koh has filed an unfair dismissal claim against CBA, alleging he was sacked by the bank in August last year for being a whistleblower.

Koh has accused the CBA of continuing to deny justice to victims of its financial planning scandal.
CBA says Dr Koh was discharged for “serious and repeated breaches of customers’ privacy, involving highly sensitive material, including medical and financial information over a lengthy period of time.”

It says the doctor’s statements and conduct during the investigation of his breaches were also deceptive.

Dr Koh is expected to give evidence to the Senate committee at a hearing in Sydney tomorrow.

By |September 23rd, 2016|Blog|0 Comments|

What is Income Protection insurance?

Income Protection can cover up to 80 per cent of your income if you’re unable to work because of sickness or injury till you can go back to work or to the age of 65 or 70. There is no actual list of events in which you can claim, it is essentially any health issue that stops you from working, so it provides a very broad protection.

Income protection can be taken inside or outside Super fund. If it is taken outside Super fund, the premium is tax deductable, for high income person, it means almost half of the premium can be claimed back by tax.

By |September 23rd, 2016|Blog|0 Comments|

Brokers will still be valuable despite disruptor threat

A leading digital academic says brokers who remain true partners with clients, by adding value in risk management or by disrupting their own business models with technology, will continue to be valuable despite the threat posed from new peer-to-peer insurance start-ups.

Last month major European disruptor Friendsurance announced its intentions to expand into the Australian market as its first international target following almost $20 million in funding.

The German-based insurtech business, which uses social networks such as Facebook to allow groups of people to pool insurance premiums and offers an annual no claims reward, is looking to launch in Australia following a funding boost from venture capital firm Horizons Ventures.

Dr Amy Gibbs, digital communications and content strategy manager at ANZIIF told Insurance Business that although it’s still early days for the sharing economy and regulators have yet to allow these disruptors into the Australian system, they are bound to shake up the industry by disrupting the status quo.

“The biggest impact they will have is on consumers. New models of insurance will allow customers to see alternatives to their current insurance options and they will start to expect those options from their existing insurers or they’ll switch,” she said.

She also said the new peer-to-peer business model had the potential to change insurance from a grudge purchase to a partnership – in health, home, travel and the like – with more agile, forward-thinking and consumer-friendly disruptive companies.

In the short term, she said, business lines are likely to be dominated by brokers. However, once people get more comfortable with the options they get in their personal lines insurance, they’ll start to expect it for their businesses too.

“Brokers pride themselves on being in partnership with their clients, if a small disruptive company can provide the same level of service, with the convenience of disruptive technology and thinking, that’s going to be a challenge for brokers to compete with.”

Gibbs also warned that customer should exercise caution when signing up to be insured with the newcomers.

“Many of them will be tech start-ups and won’t have the vast insurance knowledge – particularly when it comes to risk – that a traditional insurer will have, and that could be dangerous,” she said.

She said the biggest challenge to insurance businesses when it comes to the sharing economy is the change in customer expectations.

“Consumers will grow to expect the ease, partnership, and even the bells and whistles that disruptors will build their platforms on.”

Those insurers that can’t offer the same level of service and trust will be at a significant disadvantage, she said.

“Brokers who disrupt themselves will be better placed to compete with the change that personal lines business will potentially undergo in the next few years. As services become tailored, simpler and safer to customers – all things brokers differentiate themselves by, the need for a personal touch becomes subsumed by better technology and customer-focussed companies.”

By |September 23rd, 2016|Blog|0 Comments|

Superannuation fund members wear price rise for less disability insurance

Insurance premiums paid by workers via their superannuation funds have soared, prompting the regulator and other industry experts to question if they are getting value for money.

New research from SuperRatings released on Monday showed a median 50.5 per cent increase in premiums for death and total permanent disability (TPD) insurance paid by super fund members in 2015.

It comes just days after Australian Prudential Regulation Authority (APRA) deputy chairwoman Helen Rowell told a Productivity Commission review into the efficiency and effectiveness of the super sector that she was concerned about the potential for rising insurance costs to dilute workers’ retirement account balances.

SuperRatings found that while the average cost of death and TPD insurance spiked last year, the corresponding level of cover – that is, the maximum dollar amount people are eligible to claim barely budged.

“While premiums rose significantly, for no material increase in cover, the terms and conditions governing when people are eligible to claim on their TPD insurance have gotten much tighter,” SuperRatings chief executive Adam Gee said.

“Many people will have received a notice from their super fund telling them there has been a significant change to their insurance coverage, but unfortunately few people will have read it and fully understood the implications,” he said.

New tax rules introduced from July 1, 2015 have prompted most super funds to change the group TPD cover they purchase on behalf of members. Older style polices generally paid out if a worker was unable to continue working in their own profession due to illness or injury, but newer style policies cough up only if the policyholder has been so severely disabled that doctors deem them unfit to perform any job ever again.

Typical TPD coverage sold through super funds no longer entitles the policyholder to a pay out if they have had an arm or a leg amputated.

SuperRatings found the average annual premium for death and TPD insurance, for a 40-year-old super fund member, was $239.

“Default TPD insurance continues to be an affordable and important safety net for most super fund members in the event that they are catastrophically disabled,” Mr Gee said.

“But people who want to ensure they are covered if they loose a limb or unable to return to work in their own profession should read their policy carefully and consider seeking advice on whether they would be better off buying an individual policy and cancelling their group cover.”

The lump sum payout for a successful TPD claim is typically calculated at the same rate as the death benefit that would be paid to a deceased policyholder’s estate.

Super funds also offer income protection insurance, which members can elect to dial up or down.

The SuperRatings report, titled Insurance – when enough is enough, analysed trends in the default insurance premiums paid by super fund members, and corresponding levels of cover, over the four years to December 31, 2105. All 444 MySuper and Choice products in the market, including both non-profit and retail funds, were included in the survey.

Higher insurance premiums mean less money in accounts to accrue investment earnings and accumulate compound interest, lowering forecast retirement balances.

APRA told the Productivity Commission the super sector needed to work with the insurance industry to get a better deal for their members.

“Funds must strike an appropriate balance not to unduly reduce ultimate member outcomes”, Ms Rowell said.
Bank-owned super funds typically buy insurance from their parent company, while boutique retail and industry super funds outsource it.

Some of the largest industry super funds, such as AustralianSuper and Sunsuper, have already unveiled plans to lower default premiums for members while making it easier for them to dial their coverage up or down.

“As has been highlighted by the CommInsure scandal these insurance arrangements are incredibly complex,” Mr Gee said.

A Fairfax Media investigation into alleged mishandling of claims by the Commonwealth Bank of Australia’s insurance arm CommInsure this year prompted a slew of super funds, including HESTA and CareSuper, to review their default policies contracts.

By |September 23rd, 2016|Blog|0 Comments|

Income Protection insurance protects your biggest asset

If you had a machine at home in the corner of your living room and it spat out $100,000 each year, would you insure it?

Of course you would! Have you ever thought that your ability to produce an income is something like this machine at your home.

We all know that insurance is something that we have “just in case”. Just in case the unexpected happens and we need to call upon it. Our home insurance is in place just in case we incur major damage to our house or contents. Our car insurance is in place just in case we have a major accident. Our hospital health insurance is in place just in case we need to go to hospital.

In fact, the best-case scenario is that any insurance we have is a complete waste of money. If we haven’t had to make a claim, then we haven’t crossed paths with disaster.

For those who have been unlucky enough to make a major claim on any insurance policy, they would thank their lucky stars that they had a good-quality policy in place that allowed them to get through a tough period and eventually move on with life, albeit with a major disruption.

In my second question above I asked, what is your most significant asset? Is it your home? Your car? Your business? The answer is probably none of these.

The largest asset that any of us will have over our lifetimes is our ability to earn income. Looking at it simply, if you earned, say, $50,000 a year (increasing at the rate of inflation) from the age of 25 to the age of 65, you would have earned more than $3.26 million after tax. Similarly, if you earned $100,000 a year from the age of 35 to the age of 65, you would have earned more than $3.65 million after tax.

If we are to protect this vital and significant asset, a quality income-protection policy is a must. Not all income protection (or salary continuance) policies are alike, so it is important to understand their differences and any deficiencies. For example, the medical definitions of a policy are critical to ensure you receive payment if you are unable to work because of illness or injury. A poor-quality policy may have strict criteria, meaning you might not receive payments, just when you need it the most.

Another thing to look out for is that many policies (particularly some held within superannuation) have a limited benefit period of as little as two years. Ideally, we want our income protection policies to replace our income until our retirement age (say 65). Two years of income, while helpful, will not replace our lifelong income.

So I ask again … if you had a machine at home in the corner of your living room and it spits out $100,000 each year, would you insure it? Well let’s say it’s not a machine, but it’s you … of course you would insure it!

By |September 23rd, 2016|Blog|0 Comments|

Do I need to have my own Income Protection if company provides Income Protection to me?

Several clients of mine have income protection policies from their employers. But all of them keep their own income protection policies.

The reason is no one knows how long he/she can work with the employer. If we only rely on employer’s insurance policy, when we leave this employer in the future, that policy will stop and we have to take insurance policy by ourself. We will face two issues at that time.

1. Premium will be higher than today. Level premium is based on the age when we take the policy and won’t increase with age untill age 65. Your level premium is based on age 48.

2. If our health is not good when we apply for the policy in the future, maybe insurance company won’t offer policy.

So it is highly recommended to keep your own policy. This is good for you in the future

By |September 23rd, 2016|Blog|0 Comments|

What is the most important personal insurance?

Income Protection is the most important personal insurance for most of us. This is because:

• All education and training we have taken is for INCOME
• We work 8 hours every day for INCOME
• To pay our mortgage needs INCOME
• To maintain our lifestyles needs INCOME
• To take care of our children needs INCOME

By |September 23rd, 2016|Blog|0 Comments|

When should I review my insurance policy?

The insurance policy should be regularly reviewed to ensure it suitable to your situation.

The review can help you:
Get suitable insurance plans and trategies.Avoid overinsured which wastes your money.Avoid underinsured which makes you and your family take risk.

When should you review your insurance policy?
When there are major changes in your life, such as getting married, having new baby, buying or selling property, income increase and job change, it is recommended to review your policy. For example:When you get married or have new baby, you have more financial responsibility. Usually you should increase life insurance and TPD insurance. When your children are older or become independant, usually you should reduce the covers.When you buy a property which increases your debts, normally you should increase the life and TPD insurance which can help you or your family to pay off the debt in the event of unexpected. When you sell a property which reduces your debts, normally you can reduce the sum insured.

By |September 23rd, 2016|Blog|0 Comments|