When considering purchasing life insurance in Australia, there are some obvious factors to take into account, and some lesser ones, are still worthy of note. In this article, we will analyze some of the facts and features that may not be deal-breakers alone but may contribute to any overall decision to take out a policy.
Will life insurance in Australia cover my ongoing medical expenses?
While there may be cases where a certain policy for life insurance in Australia made provisions for an ongoing medical situation, it would certainly not be considered the norm. There are alternative types of insurance specifically designed to handle scenarios of this kind, namely:
- Critical illness cover – Serious medical conditions that require long-term, ongoing treatment are covered by this type of insurance. There are certain exclusions you must be aware of before proceeding but a CIC policy is an excellent way to protect yourself against the often prohibitive costs of long-term medical treatment.
- Income protection insurance – This is another type of insurance that can be used to pay for medical bills and rehabilitation if the policyholder finds themselves unable to work due to illness or injury.
- Total and permanent disablement insurance – As the name suggests, this type of insurance is there to support individuals who are unfortunate enough to suffer catastrophic, disabling events or illnesses.
Is life insurance in Australia tax deductible?
Unlike its sibling, income protection insurance, life insurance in Australia is not tax deductible in terms of writing it off on your tax return. However, on the flip side of the coin is the fact any life insurance payouts are not subject to taxation, whereas those of income protection are.
What additional benefits does life insurance in Australia offer?
Some insurers will go above and beyond in the services and support they offer when a successful life insurance claim is made. Some of those benefits may include:
- Grief support – Covering the cost of grief support sessions for bereaved family members via an accredited health/support provider.
- Child’s critical illness – If a policyholder’s child aged from 2-19 suffers a critical illness, limited financial support is provided.
- Financial planning – Beneficiaries who engage the services of professional financial advisors when planning how best to handle the lump sum they receive are eligible for a partial reimbursement.
- Premium freeze – Policyholders aged 30 and over can opt to freeze premium payments at the original amount, albeit with a counter-reduction in benefit amounts.
- Long-distance accommodation – Any immediate family member who needs to travel and find accommodation to be with the policyholder is eligible for some reimbursement.
- Inflation protection – Benefit amounts automatically increase in accordance with inflation or the Australian Consumer Price Index, whichever is higher.
- Repatriation – If the policyholder expires while outside Australia, an additional amount will be added to the lump sum payment beneficiaries receive to recover the cost of repatriating the body.
Individually, these benefits of life insurance in Australia may not seem significant in the grander scheme of things but they can have a powerful accumulative effect. They can represent a very real form of financial support when faced with the worst-case scenario of a loved one passing away.