In a recent study found that 95% of families didn’t have adequate levels of insurance.
One in five families are likely to be impacted by the death of a parent, a serious accident or illness that renders a parent unable to work; The typical Australian family will need to cope on half or less of their income as a result of under-insurance.¹
With so many families without adequate cover, unexpected financial pressures on top of a serious heath event can put significant strain at a very difficult time.
Understanding their finances are one of the main reasons Australians fail to protect themselves and their families. How can I afford the premiums? Here’s how.
Insurance cover through super
Did you know that you can pay your insurance premiums through your super? This may assist you with paying insurance premiums when you have a low disposable income.
Other ways to pay for cover
You can make contributions to your super fund and gain tax benefits:
• If you’re eligible to salary sacrifice to super, you can have premiums paid from pre-tax dollars. And because your super fund may be able to claim a tax deduction for the premiums, you may not need to pay tax on the contributions.
• If you’re self-employed, making a personal contribution to super from after-tax income to cover premiums lets you claim a personal tax deduction.
You could also:
• take advantage of tax offsets of up to $540 by making a super contribution to your low-income spouse ²
• make personal contributions to super, and if eligible, qualify for a Government co-contribution of up to $500³
1 Lifewise/ NATSEM underinsurance report 2010
2 Subject to eligibility
3 Eligibility for the co-contribution applies.
Source: AIA Australia Limited