Life insurance - I don't have a good deal, do I?

Chik5555 on 25/03/2015 - 22:27

Hi guys, I have just signed up for the Real Insurance offer for life insurance ($2.92/fn = $100,000), then thought I would double check it wasn't already included with my superannuation.

Turns out I, a healthy, non-smoking, non-risk taking, 26yo is paying $44.20 per month (for $459,584) with QSuper. That's including total permanent disability though. The rate is $2.55 per week per 'unit' = $114,896. If I could have one unit, okay, (single, no children, no debts other than mortgage & HECS - how much of a payout would my family need to cover costs?) but the minimum is four units if I want the cover.

Even if I added TPD with Real Insurance (anyone got rough estimates of premiums? I will call them back), surely I could get a reasonable package for $10 a month or so.

Haven't compared the nitty gritties of the covers yet, but I'm sure Ozbargainers have already examined their premiums and can pipe up some helpful thoughts.

Looks like Real Insurance might get some actual business from this gift card deal.

There's income protection I haven't looked at yet either.

Financial

Comments

  • Cheeper on 26/03/2015 - 07:03
    +2

    Always assess personal insurance carefully… it is not difficult to be flushing a lot of $'s down the tube unnecessarily. Don't get sucked in by high pressure advertising or just the offer of a gift card.

    • mskeggs on 26/03/2015 - 18:40
      +2

      I very much agree. In your life situation you have zero need for life insurance, but TPD is useful, and you might want to consider income replacement, should you be unable to work for an extended period (mine will pay 75% of my salary if I can't return to work after 60 days).

      Note HECS is waived if you pass away, and in the unlikely event your mortgage couldn't be paid out from the sale of the property, the banks have no redress against other members of your family if they aren't signatories to the loan. So you don't really need to leave anything for family members, assuming you have a few thousand in savings or pay owing (e.g. unused holiday pay) that would cover funeral expenses, if you wish to cover that.

  • vikvance on 26/03/2015 - 23:16

    The chances of becoming disabled are reasonably high & premiums for TPD-only cover are generally around the same amount as for a Death-only cover. An example is on page 11 of the Australian Super insurance booklet http://www.australiansuper.com/layouts/Download.aspx?ID=64a7…

    So, we can divide the $44.20 QSuper premium in half, to estimate the premium for the death-only cover.

    That means for a $100,000 death-only cover, QSuper is effectively charging $44.20 / 2 / 4.59583 /2 = $2.40 per fortnight, which is reasonably less than Real Insurance.

    Generally, premiums for insurance cover through super is cheaper because super funds are able to use their size & bargaining power to negotiate lower rates from insurance companies.

    If you want a lower amount of cover or Death-only or TPD-only cover then one possible option could be to move your Super & your insurance to another fund such as Australian Super ?

    • Chik5555 on 26/04/2015 - 18:26

      I suppose it's not a bad price with QSuper but just they have a higher minimum that doesn't work for me.

      QSuper is compulsory for me unfortunately.

      I'll shop around. Thanks, your post was helpful.

  • x31337 on 03/04/2015 - 20:44

    Going through super (i.e. group insurance) will most likely be significantly cheaper than retail. Looking at group premiums will give more meaningful comparisons than comparing different retail premiums.

    • Chik5555 on 26/04/2015 - 18:27

      Is the only way to access group premiums through your own super, or can you purchase them from another super provider?

  • marquise on 08/04/2015 - 19:55
    +1

    I have received so many spam phone calls relating to Real Insurance, I would never give them my business based on that principle alone.

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