r/AusFinance • u/dustbowlbride • 1d ago

IP through Super.

I recently acquired income protection through my super (Aware Super) and I am a little confused as to why the premium is so low.. $98 a year?? 60 day waiting period, benefits paid for up to 2 years, matches my current monthly wage.

When I went for quotes through external providers, it was much much more. Is this accurate?

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2

u/mjwills 1d ago

That does seem low. Are you 100% sure that is a yearly premium? Do you earn more than $36K a year?

AwareSuper

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u/dustbowlbride 1d ago edited 1d ago

Yes I’m on 94k a year (gross). The app says Annual Premium - $98.78

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u/mjwills 1d ago

And it covers 85% of that salary? You checked that specifically?

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u/dustbowlbride 1d ago

I just entered all my details into that calculator and got the same amount- $98 a year.

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u/mjwills 11h ago

Well then you are clearly quite low risk.

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u/dustbowlbride 11h ago

Correct that’s what my policy says

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u/Jitterbugs699 18h ago

Some terrible advice on here. As with most contracslts the devil is in the detail.  All IP has a waiting period. 60 days isnt particularly long. many are 90 days. 2yrs cover is very basic. "until 65" is much better (but more expensive). "Own occupation" vs "Any occupation" is important. What percentage of your original base salary will it pay?  Will it pay your super? (usually wont) Will it still pay if you also claim TPD?  Ask for a copy of thr pds and feed it into AI and ask for the key points to consider. The main issue from what you mention so far is the 2yrs limit. There are lots of people permanently unable to work that bitterly regret cheaping out on the until age 65 and choosing 2 yrs (they end up on the goverment disability support pension after 2yrs and its not enough to live on).

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u/kizzt 1d ago

Super long waiting period, and generally has narrower scope of cover than separate cover. Can you afford to wait 2 months of no income after an accident before the cover kicks in? Also depending on the terms, it may exclude illness (or certain illnesses) too. Without comparing the wordings, none of us can say for sure.

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u/dustbowlbride 1d ago

Can I transfer the cover out then? Who would you recommend? I’ve only applied for the income protection so far because I recently became a homeowner and have exclusions for lumbar (pre existing back problem) and mental health. Would you recommend getting TPD too?

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u/Alovablecactus 1d ago

Nobody can recommend anything as that would be considered general advice which can't be given.

However the easiest way to think about it is income protection keeps the lights on and water running and tpd covers for example a mobility vehicle and additional care.

Without knowing your job pretend you suffered a catastrophic injury that left you bed bound. Your income will pay for 2 years of power water and rates. You don't have any tpd so it would be straight onto Centrelinks disability which won't pay your mortgage.

You should look at your personal circumstances and the products available and determine what level of risk you're looking to offset

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u/BrushHuge7223 1d ago

yeah its usually cheap because they cut corners everywhere. the 60 day wait is really long and the definition of disability is often stricter. like you need to be unable to do any job not just your own job. read the pds careful

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u/No_Reach_1259 1d ago

the definition of disability is often stricter. like you need to be unable to do any job not just your own job.

Isn't this TPD Insurance? OP is talking about IP.

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u/_dance_of_days_ 1d ago

A 60 day waiting period on an IP policy is effectively 90 days becuase life insurers pay income protection benefits in arrears as well.

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u/No_Reach_1259 1d ago

Are you sure that's the yearly premium?

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u/dustbowlbride 1d ago

I can’t attach photos here but my aware super app says Annual Premium - $98.78.
Do they buy insurance in bulk or something? I went through super because I thought it made more sense but now I wish I had just forked out to get it externally. Really annoying because the whole process of being asked medical questions was so meticulous.

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u/pwinne 1d ago

Sounds more like a monthly

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u/dustbowlbride 1d ago

Monthly says $8…

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u/pwinne 1d ago

Amazingly cheap

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u/dustbowlbride 1d ago

It just sounds too good to be true? I think I’ll contact them tomorrow.

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u/BasisPuzzleheaded161 22h ago

It is cheap because it is very hard to successfully claim it

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u/dustbowlbride 22h ago

Okay so looks like I’m better off transferring out to n external provider.

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u/BasisPuzzleheaded161 20h ago

If you really want to make sure you will get your claim, get a fully underwritten one. It is much more expensive though

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u/Fluid_Passage_9980 1d ago

Benefits only paid for up to 2 years? I think most of them pay for the rest of your life if you sustain a severe injury?

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u/secretaussieagent 1d ago

Thats moreso TPD not IP

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u/Puzzleheaded_Set5329 1d ago

I recently had to put a claim in for IP through MetLife, 90 day wait period. But I didn’t see $$ for 6 months, keep that in mind. These departments are usually understaffed hence the long wait. Luckily I had money saved to get through.