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Employee Income Protection

When thinking about our most valuable assets, we often picture our home and contents, even our life. You may not hesitate to insure these assets, but what about your greatest asset – your income? By taking out Income Protection insurance in a super fund, you can:

  • Protect your family’s lifestyle if you’re unable to work due to illness or injury, and;
  • Take advantage of some benefits not available when insuring outside super.

How much will you earn by age 65?

If you’re in any doubt about the importance of protecting your income, the table below shows how much you could earn by age 65. For example, if you’re currently 35 and earn $60,000 pa, you could earn almost $4 million before you turn 65. Isn’t that worth protecting?

What is income protection insurance?

  • If you suffer from an illness or injury and are unable to work, Income Protection insurance can pay you a monthly benefit (typically up to 75% of your pre tax income) to replace lost earnings.
  • You can choose from a range of waiting periods before you start receiving your insurance benefit, with options normally between 14 days and two years*
  • You can choose from a range of benefit payment periods, with the maximum cover generally available up to the age of 65.
  • While you can buy Income Protection insurance within or outside a super fund, insuring within super can offer some additional benefits.

*Total disability benefits may not be payable by the Trustee while you are on paid leave (including sick leave.)

Why hold Income Protection in Super?

Affordability: You can arrange to have the premiums deducted from your existing super balance. This can enable you to buy Income Protection Insurance if you don’t have sufficient cash flow to pay the premiums outside super.
Convenience: If you already hold Life and Total and Permanent Disability insurance in super, taking out Income Protection Insurance in the same fund can enable you to consolidate all your personal insurances in the one place. You may also save on fees when compared to holding your personal insurances in separate policies.

Is Income Protection in Super new?

No. Until recently, super funds generally offered Income Protection insurance with benefit payment periods up to a maximum of two years. However, due to recent changes, some super funds are now offering Income Protection insurance with benefits payable until you reach age 65. This additional feature, along with the benefits outlined above, has made Income Protection Insurance in super a compelling option to consider.

Brian Woods & Peter Campbell, Nexus Wealth Management Pty Ltd T/A Nexus Wealth Management Authorised Representatives GWM Adviser Services Limited Australian Financial Services Licensee Register Office at 105 - 153 Miller Street North Sydney NSW 2060 Copyright © 2017 Nexus Wealth Management All Rights Reserved