chatterbox Posted November 12, 2015 Share Posted November 12, 2015 Hi folks, Wondered if anyone can help with my dilemma. We move over to Perth on 1st Jan. It'll only be me earning to begin with until my husband secures a job. I'm super paranoid about falling ill as only have 12.5 days sick pay to begin with (scary thought given I'm leaving a job here with 6 months full pay and then reduced for another six months). My husband thinks I'm a worry wort as I'm never off sick here, but I'm concerned about how we'd pay the bills if the unlikely did happen. We do have enough savings to tide us over for a couple of months, but my mum really struggled financially during her two battles with cancer, so I want to be cautious. My plan is to get trauma and income protection asap. We won't have a mortgage for a wee while, so not so worried about the life insurance side of things just yet. Is there generally a long waiting period before these policies kick in (I understand that each one will vary)? I know we get to choose how long our waiting period is for income protection (we're going to go with 30 days), but what about trauma protection? I've been using comparison sites and reading all the literature but it's still all very confusing... My second question is can be set these policies up while we're still in the UK? I'm thinking particularly if there is a six month waiting period. I don't want to set them up, have to claim and then realise the policy was never valid in the first place. Thanks! Link to comment Share on other sites More sharing options...
Andrew from Vista Financial Posted November 13, 2015 Share Posted November 13, 2015 Hi chatterbox Have a look at page 38 from this product disclosure statement (PDS) regards Trauma Cover (critical illness cover), they are one of the main insurers in Australia, this would be pretty standard across most retail Trauma policies: http://www.onepath.com.au/public/pdfs/L7533_OneCare_PDS.pdf Unlikely that you would be able to obtain cover until you are in Australia particularly with income protection as you are looking to protect your Australian income but are not in that role yet. A lot of employer superannuation funds offer default Life, TPD and sometimes Income Protection cover as default cover when joining the scheme, Trauma is not available through superannuation. My advice to you would be to arrange an appointment with a Financial Planner when you arrive as they will be able to advise you on your options, going direct is not wise as the contracts tend to be not what they seem (is probably the best way to describe it), also a non bank Adviser will be able to search a very wide range of providers to tailor the outcome to your needs. Hope this helps Andy Link to comment Share on other sites More sharing options...
Marisawright Posted November 13, 2015 Share Posted November 13, 2015 I got Income Protection Insurance shortly after arriving in Australia with no problems, and I had a pre-existing condition as well. I don't see why you'd need trauma insurance as well? If you have health insurance, then that will look after your hospital costs and the income protection insurance will look after paying your salary while you recover. Also, if you get a lump sum from trauma insurance, your income protection may not pay out anything (my income protection had a clause saying it wouldn't pay out if you had already claimed for the same incident from any other insurance policy). That's also a reason to check out what insurances your superannuation will offer. Insurance within your super is often cheaper than paying it yourself, too - and since you can keep the same super fund when you change employers these days, it's nice and straightforward. You can (and should) choose your superannuation provider yourself - your employer will have a default fund but you don't have to accept it, you just fill in a form and give it to them. So look for one that's got the insurances you want. Here's one of the biggest funds which offers insurances: https://www.australiansuper.com/superannuation/why-choose-australiansuper/insurance-choices.aspx Link to comment Share on other sites More sharing options...
scuffythetugboat Posted November 13, 2015 Share Posted November 13, 2015 We have life insurance with a UK company taken out before we came to Australia. When we came over here I asked about cover outside of the UK and they told me in writing that so long as the premiums were paid we are covered in anywhere. So if you have insurance in the UK yourself, just ask the same question. Link to comment Share on other sites More sharing options...
Guest The Pom Queen Posted November 13, 2015 Share Posted November 13, 2015 Hi chatterbox Have a look at page 38 from this product disclosure statement (PDS) regards Trauma Cover (critical illness cover), they are one of the main insurers in Australia, this would be pretty standard across most retail Trauma policies: http://www.onepath.com.au/public/pdfs/L7533_OneCare_PDS.pdf Unlikely that you would be able to obtain cover until you are in Australia particularly with income protection as you are looking to protect your Australian income but are not in that role yet. A lot of employer superannuation funds offer default Life, TPD and sometimes Income Protection cover as default cover when joining the scheme, Trauma is not available through superannuation. My advice to you would be to arrange an appointment with a Financial Planner when you arrive as they will be able to advise you on your options, going direct is not wise as the contracts tend to be not what they seem (is probably the best way to describe it), also a non bank Adviser will be able to search a very wide range of providers to tailor the outcome to your needs. Hope this helps Andy @andrew from Vista Financial is this something you can help with? I presume cover isn't available for pre existing conditions? Link to comment Share on other sites More sharing options...
chatterbox Posted November 13, 2015 Author Share Posted November 13, 2015 Thank you all for your replies, very useful. Andrew - I haven't even thought about pension yet, eeek! I'll certainly look into what's offered. I will admit that I just went with my employers scheme out of easiness, but no doubt that isn't the best option... No paperwork yet though to check. I'm keen to seek advice from a financial adviser but worried about the cost. Would you be able to give me a ball park figure Andrew? Should I just search for one online? Marisa - We intend to take out private health care, but I believe we're liable for "gap" payments therefore wanted the peace of mind, at least while we get up on our feet, that these would be covered effectively by income protection/trauma insurance. Thank you for the heads up on not having both, I hadn't thought of that. Scruffythetugboat - Great idea. Unfortunately our life assurance policy ends just before we leave but I do still have a WellWoman policy I'm continuing to pay as will eventually get a return of premiums if I don't claim. I'll get in touch with them. Wow, I never thought that sorting out personal finance would be more challenging than applying for our 189 visa! Thanks again everyone Link to comment Share on other sites More sharing options...
Marisawright Posted November 13, 2015 Share Posted November 13, 2015 Marisa - We intend to take out private health care, but I believe we're liable for "gap" payments therefore wanted the peace of mind, at least while we get up on our feet, that these would be covered effectively by income protection/trauma insurance. Thank you for the heads up on not having both, I hadn't thought of that. If that's the case, perhaps you shouldn't take out private health insurance just yet! If you don't have private health, all your medical costs will be covered by Medicare, just like the NHS in the UK. The only time you'll have a problem is if something is classed as "elective", in which case you could have a very long wait. It varies a bit round the country, but in general it's a myth that private treatment is better than public - in country areas you're often in the same hospital, just in a fancier room! I've had treatment in both systems and have often found the public specialists better than some of the private ones! Anyway the point is, if you have an accident you'll get treated for free in the emergency room, so I wonder how important trauma insurance would be. Income protection I can certainly see the point of - but why wait till you get the paperwork. Just ask the employer who the superannuation fund is with and contact them direct. Link to comment Share on other sites More sharing options...
Ken Posted November 14, 2015 Share Posted November 14, 2015 Just ask the employer who the superannuation fund is with It's not the employers job to tell you who the superannuation fund is, it's your job to tell the employer who the superannuation fund is - but many employers (not all) do still have a default super fund (even though it's no longer a requirement to have one) which they can tell you about. Link to comment Share on other sites More sharing options...
Marisawright Posted November 14, 2015 Share Posted November 14, 2015 It's not the employers job to tell you who the superannuation fund is, it's your job to tell the employer who the superannuation fund is - but many employers (not all) do still have a default super fund (even though it's no longer a requirement to have one) which they can tell you about. I know and that's what I said in my first post - but the OP said she had already accepted the default fund and was waiting to hear more detail. Link to comment Share on other sites More sharing options...
Andrew from Vista Financial Posted November 16, 2015 Share Posted November 16, 2015 @andrew from Vista Financial is this something you can help with? I presume cover isn't available for pre existing conditions? Hi PQ Yes we advise on and arrange Trauma (Critical Illness Cover) for clients, regards pre-existing conditions.....this would depend upon a range of factors including how severe the condition is and whether it is ongoing or not. For example someone close to me has had and fully recovered from cancer (hodgkin's lymphoma at age 15), they are now age 38 but cannot get a fully underwritten Trauma policy. Although depending on the condition it is not always the case that cover will not be given, it may be that the particular condition is excluded from the contract or that cover is accepted but with a loading (increase to the standard premium). Thank you all for your replies, very useful. Andrew - I haven't even thought about pension yet, eeek! I'll certainly look into what's offered. I will admit that I just went with my employers scheme out of easiness, but no doubt that isn't the best option... No paperwork yet though to check. I'm keen to seek advice from a financial adviser but worried about the cost. Would you be able to give me a ball park figure Andrew? Should I just search for one online? Marisa - We intend to take out private health care, but I believe we're liable for "gap" payments therefore wanted the peace of mind, at least while we get up on our feet, that these would be covered effectively by income protection/trauma insurance. Thank you for the heads up on not having both, I hadn't thought of that. Yes lots to think about but don't panic, pensions can wait, no rush there, wait until you are settled before considering these. Financial Advisers typically work on commission for insurance a bit like a mortgage broker therefore no direct cost to you but if you prefer they could potentially work on a fee basis, if you work on a fee basis the premiums might reduce by up to 30%. If you are working on a fee basis then advice will cost around $750 - $1,500 and then an implementation fee so perhaps $2,500 - $4,000 total, I would suggest that most people prefer them to work on commissions unless the premiums are going to be substantial. Regards not having both....they really are two different types of cover. Income protection is typically to replace lost income in the event of not being able to work from minor through to major situations and is usually paid monthly in arrears and is taxable, this cover will have a waiting period say 30 or 60 days before a claim can be made and a benefit period anything from 2 years to age 65 for which benefits will be paid. Insurance in superannuation is generally a group cover contract and therefore quite basic with cover not tailored to the individual for example wait and benefit periods not always as people want or need them amongst other things. Typically group insurance in super is not guaranteed renewable (or worldwide) and this could create problems in the future particularly is a persons' health is not the best, an example of this would be insurance cover for the Super Fund in the link provided above, generally the cover in this fund ceases if an employer contribution has not been made for 13 months, if someone's employment situation changes ie starting a family and taking some time out or going to work for the government (here in SA you must use the government super fund) etc. Trauma cover (AKA critical illness cover and recovery money) is a tax free lump sum which is paid on diagnosis of a condition ie cancer, stroke, heart attack. Typically this cover is taken to assist with medical costs, perhaps pay down some of the mortgage and or to use as a financial cushion perhaps for a recovery period. Both can pay at the same time but there can be instances where this cover is paid out and income protection not, for example we have a client who has recently had breast cancer (fortunately it was diagnosed very early), unfortunately she did not have Trauma cover (we had applied for it a few months earlier but she was declined due to other health reasons). However she continued to work throughout the period of diagnosis and treatment (radiotherapy), the good news is that treatment has been successful but she came down with pneumonia just after treatment and now has a suspected collapsed lung, the cost so far of treatment (out of pocket costs over and above what medicare and her private heath has covered) is $15,000. Another client (super/investment client) was recently diagnosed with prostate cancer, he has just withdrawn his superannuation monies fully to pay for a trip to the US where he is going to have advanced treatment. Of course income protection would not cover these type of costs, and even if income protection was paying a monthly income during a critical illness if a person is treated successfully then income protection would likely cease going forward however that person may not wish to return to work straight away or indeed return to their usual job (stress etc) or hours and so having a lump sum in the bank would assist in transitioning back to work over time. Link to comment Share on other sites More sharing options...
chatterbox Posted November 23, 2015 Author Share Posted November 23, 2015 Hi Andrew, Thank you so much for your detailed reply - apologies I've only just seen it hence the late thank you! $15000 out of pocket expenses for cancer treatment, eeeek! That's a scary prospect. I appreciate how fortunately we are in the UK to have the NHS, but that seems like a huge amount of money when the poor person had already been paying for health insurance. One of the things we all have to face though when moving over. Thanks again, Cora Link to comment Share on other sites More sharing options...
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