Insurance Inside Super

Insurance Inside Super

The Advantages of having insurance inside super

  1. Deduction for premiums paid can be used to offset tax paid on contribution.
  2. It is tax effective.
  3. It is convenient to have premiums deducted from your super account.
  4. You can contribute extra to super to pay premiums via salary sacrifice of through after-tax money and you may be eligible for Government co-contribution.
  5. It is always better to have some cover rather than no cover.

Key Considerations

  1. Insurance plans in super are very basic.
  2. Possible issues when accessing benefits due to possible difference in definitions.
  3. There are strict super rules as to who can receive the benefits.
  4. If benefits are left to a non tax dependent, the tax implication can be high.
  5. There may not be continuity of cover if you leave the fund.
  6. You do not have control as the trustee of the fund will have discretion.

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