Insurance Premiums such as Life, Total and Permanent Disability, Income Protection and Trauma can be expensive and is one of the biggest reasons why people don’t take out cover. There are two main ways that premiums can be setup. Stepped or Level. As its name suggests Level premiums stay level while you have your insurance cover. Some level premiums can increase in line with inflation, but things like your increasing age or risk do not affect the amount of the premium. This cover is usually more expensive to start with, but you can be assured the premiums will not increase and over the long term could be the cheaper option. Stepped premiums on the other hand can increase every year as you get older. This cover can be very cheap to start with but over the years the premiums could become unaffordable and at a time when you may need the insurance the most.
Some insurances can be placed inside of your superannuation fund, which means that your super fund pays the premiums of your cover. Some super funds also allow you to choose between Stepped and Level premiums. Contact us for more information about this.