ADAPTABLE
INSURANCE
FOR LIFE.
INSURANCE
INSIDE SUPER
Case studies include the Total Care Plan Super
Rollover discount (TCPS RD)
Adaptable insurance for life.
Clients’ needs and budgets can change – they move
jobs, get married, have children, transition to retirement.
That’s where CommInsure’s inside super insurance
offering steps in – allowing you to balance effective
insurance solutions and provide more affordable
options for your clients’ varying needs.
Securing your clients’ financial future is important,
but with many Australians choosing to tighten
their belts and cut spending, insurance can be
one of the first things to go.
But that doesn’t have to be the case.
Holding insurance inside super can provide a
viable solution for your cash-strapped clients by
allowing them to fund premiums via their existing
super account balance, or by making pre-tax
contributions into super.
In fact, you can offer your clients cover inside
super, outside super, or a combination of both
with CommInsure’s Flexi-linking and Split TPD
functionality – both of which are available via
Total Care Plan Super (TCPS) or the SMSF Plan.
And if your clients’ budget changes and cash
flow is no longer a concern, CommInsure’s
continuation option offers you the ability to
easily move cover outside the superannuation
environment, without having to provide any
further health evidence.
CLIENTS’ BEST INTERESTS
Flexibility
Affordability
Other benefits
Flexi-linking allows for
inside/outside super
combinations.
Discounts - SPM/Renewal
Reward/Top-Up.
Day 1 cover.
Payment options – cash,
direct debit, any complying
fund rollover.
Standing authority
on rollovers.
Continuation options –
no additional underwriting.
Can add or remove options.
SIS-aligned agreed value
income protection.
Potential tax deductibility of
premiums to the trustee.
SIS aligned – what you
see is what you get.
Claims strength.
Not ‘out-of-pocket’ –
pay from your super.
Competitive premiums.
Flexibility to remove options
to make it more affordable.
Flexi-linking allows for
inside/outside super
combinations.
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Funding premiums
without reducing cash flow.
Holding insurance inside super can provide a viable
solution for your cash-strapped clients by allowing them
to fund premiums via their existing super account balance.
Super Payment Method (SPM) is CommInsure’s
rollover payment facility that automatically
transfers money from your client’s superannuation
balance to pay their insurance premiums each
year. Your clients can choose from any complying
super fund to rollover premiums.
By using SPM, clients’ will receive an ongoing
Renewal Reward of up to 15 per cent when
they renew their policy each year using rollover
monies. In addition, an instant 15 per cent
discount on their premiums may be available
through SPM15 Plan code.
Case study: Dean’s Story
Dean is a 30 year old accountant living in Sydney
who earns $85,000 per year.
Dean has a comprehensive Total Care Plan
Super package including $1m of both Life and
TPD cover as well as income protection for
$5,000 per month.
Dean’s premiums are paid via SPM and he has
also signed a standard authority to automatically
rollover each year on renewal.
Client
benefit Year 1
Client
benefit Year 5
Client
benefit Year 10
Client
benefit to age 64ˆ
Year 1 premium
$1,302
-
-
-
-
Year 1 premium
with SPM15#
$1,119
$183
$183
$183
$183
Year 1 premium
with SPM15 &
5/4/3/2/1
$1,057
$245
$368
$368
$368
$995
$307
saving
$1,417
saving
$2,876
saving
$46,964
saving*
Year 1 premium
with SPM15 &
5/4/3/2/1 and RD
Your clients can also preserve their disposable
income by funding premiums from personal or
employer pre-tax super contributions, including:
◆ Concessional contributions
◆ Superannuation Guarantee contributions
◆ Salary sacrifice.
We also accept a wide range of other
contributions including non-concessional
(personal) contributions.
Case study: Adele’s Story
Adele is a 48 year old university lecturer who
earns $100,000 per year.
On the recommendation of her financial adviser,
she is looking to take out $1 million of life and
TPD insurance and income protection of $75,000
p.a. She is able to salary sacrifice some of her
employment income and is wondering if she
should have insurance inside or outside of super.
By having insurance inside super, and utilising
salary sacrifice contribution, the maximum
tax payable by the super fund on Adele’s
superannuation contribution would be 15 per cent.
Insurance
product
Annual
premium
Outside
super
Inside super
(net of notional
cash flow savings*)
Notional
cash flow
savings**
Client benefits include Renewal Reward
* Cumulative saving over the life of the policy
#
SPM15 discount does not apply to the policy fee
Life & TPD
$1,350
$1,350
$1,032.75
$317.25
Note: the SPM15 discount does not apply to the policy fee. Quote based on 30 year old male, NSW, non-smoker,
annual, stepped premium, super professional occupation, any occupation TPD, indemnity IP, 1 month waiting
period, benefit period to age 65, increasing claim option, includes $75 policy fee. Correct as at 26 July 2015.
Income Care
$2,648
1
$2,648
$2,025.72
$622.28
Total
$3,998
$3,998
$3,058.47
$939.53
^
Based on a 48 year old female (49 next birthday), non-smoker, living in NSW, stepped premiums and a $6,250 monthly Income Protection
benefit. Monthly premiums are correct as at 26 July 2015.
* Assuming a marginal tax rate of 38.5% (inclusive of Medicare Levy)
** Her notional cash flow savings represent the difference between her marginal tax rate (38.5%), which may have applied to the salary
sacrifice contribution to the super fund and the actual tax on contributions payable by the super fund (15%).
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Linking cover inside
and outside of super.
CommInsure’s Flexi-linking enables clients to
link to covers not allowable under super, such as
Trauma Cover and Total and Permanent Disability
(TPD) with an ‘own occupation’ definition.
Whatever your client’s financial position,
Flexi-linking allows you to explore many cover
options to suit both their protection needs and
their back pocket, by enabling clients to purchase
‘packaged priced’ insurance across super
and non-super policies under one policy fee.
Similarly, Split TPD Cover provides clients with
the advantage of having part of their TPD under
super, linked to the more generous TPD ‘own
occupation’ definition outside super.
Flexi-linking is suitable for a range of clients
including individuals, families and Self-Managed
Super Fund members.
The following three case studies are modelled on
our Flexi-linking affordability scenario diagram.
This diagram can assist you in exploring all the
options to ensure your clients’ cover combination will
maximise cash flow, enjoy premium savings and
provide your client with the best cover to suit
their needs.
See how it works
Cash strapped
Cash cautious
Cashed up
Case study:
Matt and Erika’s Story
Case study:
David and Reina’s Story
Matt and Erika, both 35 years old, are ‘cash
strapped’ clients. They are married with two kids
and Erika is currently caring full time for their children
while Matt works as a Sales Representative.
They have limited income with high expenses,
leaving little income to spare.
David and Reina, both 35 years old, are ‘cash
cautious’ clients. They want to see value in their
insurance cover. David and Reina want to
minimise their out of pocket expenses but not
lose features and benefits.
Matt
Erika
Total Care
Plan Super
Total Care
Plan Super
• Life Cover
• Life Cover
• TPD Cover
(any occ)
• TPD Cover
(homemaker)
Inside
• Income
Care Super
With limited income, Matt and Erika pay
an annual premium via a rollover from their
superannuation balance:
◆ All cover in super.
◆ Married with kids.
◆ One parent working,
and one caring full time
for children.
◆ Limited income with
high expenses.
= Little income to spare
◆ Many clients - income
◆ These clients want
◆ DINKS or empty nesters.
◆ Want the best options.
◆ Don’t want to erode their
◆ They want to minimise
◆ May have already reached
could range from
$20,000 pa to millions.
to see value.
out of pocket expenses but not lose features
and benefits.
◆ High income but
with high expenses.
= Careful with how
they use their money
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SMSF or super balance.
Anual
Matt
Erika
TCPS premium
$1572.92
$908.87
TCPS premium with
Rollover discount
$1494.72
$817.98
While they have a high income, their expenses
are also high, making them careful with how they
use their money.
David
Reina
Total Care
Plan Super
Total Care
Plan Super
• Life Cover
• Life Cover
• TPD Cover
(any occ)
• TPD Cover
(homemaker)
Inside
Flexi-linked
Total Care Plan
Outside
• David Trauma flexi
• Reina Trauma flexi
Income Care Range
• David Income Care Plus*
contribution caps.
◆ May be of use for clients
with estate planning needs.
= Can utilise more
traditional product
combinations
Super funded
100%
Client funded
0%
Premiums based on $1 million Life/TPD cover (any occ), male and
female, both 35, non-smoking, Matt’s occupation is Clerical, Erika is
a homemaker. Income Protection is for $5000 monthly benefit, 30
day wait, age 65 benefit period, indemnity, increasing claims option.
All policies are annually paid, stepped premium, registered in NSW.
Correct as at 26 July 2015.
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SMSF
Insurance Plan
Annual Premium David
Reina
TCPS (including
Rollover discount)
$703.77
$825.48
TCP Trauma Flexi
$397.82
$506.09
ICP*
$698.33
n/a
Total
$1799.92
David
Reina
$1331.57
Combined
Case study:
Bill and Veronica
Bill and Veronica are ‘cashed up’ clients whose
children have grown up and no longer live at
home. They want the best insurance options and
don’t want to erode their super balance.
Bill
• Life Cover
• TPD Cover
(standalone)
◆ Flexible. The structure allows ‘any occupation’
Super
funded
Client
funded
Super
funded
Client
funded
39%
61%
62%
38%
49%
51%
• Trauma
(standalone)
Total and Permanent Disability (TPD) cover in
super and ‘own occupation’ TPD or Trauma
outside super.
◆ Potentially cost and tax effective. The SMSF
Income Care
Range
Plan offers Life Care, TPD Cover, Accidental
Death Cover, and income protection cover
inside super. It also allows TPD Cover to be
selected as a rider (to Life Cover) or as a
standalone benefit.
• Income Care
Plus Permanent
Disablement
Cover Option
Annual
Bill
Veronica
Premium
$5131.30
$1696.87
Super funded
0%
Client funded
100%
Male and female both 45 ANB, non-smoking super professionals,
sum insured of $1m for life and TPD, and $500k for Trauma.
Income protection based on ICP of $5,000 monthly benefit, 30
day waiting period, benefit period to age 65, indemnity, NSW, ICO,
stepped. Correct as at 26 July 2015.
Split TPD (own occ) (rider)
Trauma Flexi-linked
• Life Cover
Case study:
Eddie’s Story
Eddie is 35 years old and works as a Marketing
Executive. He requires insurance and his adviser
recommends the SMSF Plan with Flexi-linking.
Inside
SMSF Plan – Split TPD
(any occ)
◆ Aligned to the SIS conditions of release, and
gives trustees peace of mind in the event of
a claim.
Client
funded
SMSF Plan – Life Cover
Income Care (standalone)
Total Care Plan
Super
funded
Outside
Eddie
Further benefits of SMSF Plan are:
Total Care Plan
• TPD Cover
(standalone)
Premiums are based on $1 million Life and TPD Cover (any occupation)
and $250,000 Trauma cover, male and female both 35 (age next
birthday), non-smoking professionals, stepped premium. Income
protection based on a monthly benefit of $5,000, 30 day waiting
period, benefit period to age 65, indemnity, NSW, professional, with
Increasing Claim Benefit, stepped premium. Correct as at 26 July
2015. *Generally tax deductible.
Veronica
CommInsure’s SMSF Plan is tailored specifically
for the SMSF market, providing a ‘no-hassle’
solution which aims to align with the SIS Act’s
‘conditions of release’. The SMSF Plan includes
a suite of covers including Life Cover, Accidental
Death Cover, TPD Cover (rider, split and
standalone) and income protection (standard
and accident only options).
Outside
Annual
Eddie
SMSF Plan – Life Cover
$477.97
SMSF Plan – TPD Cover
$304.00
Split TPD (own occ rider)
$159.60
Trauma Flexi-linked
$515.52
Income Care (standalone)
$698.33
Total
$2155.42
Super funded
36%
Client funded
64%
Premiums based on $1 million Life/Split TPD cover, $350k Trauma
Flexi-Linked, age 35, male, non-smoker, Professional occupation
rating. Income Protection is for $5000 monthly benefit, 30 day
wait, age 65 benefit period, indemnity, increasing claims option.
All policies are annually paid, stepped premium, registered in NSW.
Correct as at 26 July 2015.
On average, standalone premiums for TPD and Trauma are
approximately 25 per cent more than rider premiums.
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Not all insurance
in super is the same.
Helping you,
help your clients.
Remember, while a large number of Australians
hold insurance through their group super, they
may only have default sum insured levels which
is often not enough to fully meet their needs.
CommInsure offers a solid approach to personal
risk insurance, backed by a strong history – as
one of Australia’s largest life risk insurers and our
roots in the Australian insurance industry dating
back over 140 years.
Insurance through super plans may also be
tied into employment arrangements, which
means that if your client ceases or changes
employment, they could be at risk of losing their
insurance cover. Similarly, if they consolidate
their super under a different super plan, they also
run the risk of not being covered under their new
super plan or having reduced cover.
Holding retail insurance inside super can
complement your client’s existing insurance
arrangement in a number of ways:
◆ As a top-up strategy where existing sum
insured levels under the current superannuation
fund are not enough to meet client needs.
◆ For clients with an existing group salary
continuance arrangement policy two-year
benefit period, CommInsure’s income protection
cover can be purchased with a two year
waiting period and ‘to age 65’ benefit period.
If the client’s group salary continuance cover
ceases, CommInsure’s income protection
has an in-built upgrade facility for the client
to switch their waiting period from two years
to three months without further underwriting
(subject to terms and conditions).
◆ Should your client ever lose their insurance
under their super or employer plan; the retail
insurance remains in place until such time the
client decides to cancel, convert the policy to
Total Care Plan (before age 75) or the cover
simply expires (e.g. age 80 for Life Cover under
Total Care Plan Super).
We support your business
◆ Dedicated Business Development Manager
and local Underwriter.
◆ Amplify your knowledge with the Underwriting
and Claims Academy.
◆ Superior technical expertise with InsuranceTech.
◆ Access to a wide range of customisable marketing
We reward your clients’ loyalty
◆ Your clients receive an extra 5 per cent cover at
no extra cost (for any Life Care or TPD benefit
which becomes payable) if they keep their
Total Care Plan Super cover for five years. So a
$500,000 payment would become $525,000.
◆ Your clients receive $50,000 of accidental death
cover at no cost if they keep their Income Care
Super cover for three years – increasing by
another $10,000 every year.
◆ Renewal Reward of 15 per cent for Total Care
Plan Super when they renew their policy each
year using the Super Payment Method.
material through Smart Adviser Marketing.
◆ Invaluable sales training for all industry tenure
levels, with Risk Skills Academy.
We pay claims
Our claims philosophy is simple: we pay all
genuine claims promptly and efficiently. In 2014
we paid out more than $879* million in life and
disability insurance claims, which translates to
more than $16 million every week!
In addition, retail insurance in super is also
guaranteed to be renewable; meaning the terms
and conditions of the cover when purchased
cannot be altered by the insurance provider to
the point where the client’s cover is less than
what they were covered for before the change.
Insurance purchased through super schemes
or corporate plans are usually not guaranteed
renewable, which means that they can be
changed and may end up providing the client
with inferior cover for their needs.
*Direct, Group and Retail claims combined for calendar year 2014
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1800 805 686
8 am - 8 pm (Sydney time)
Monday to Friday
CIL1773 260715
adviser.comminsure.com.au
Important information This document has been prepared by CommInsure, a registered business name of The Colonial Mutual Life
Assurance Society Limited ABN 12 004 021 809 AFSL 235035 (CMLA). It is for adviser use only and is not to be distributed in full or in part
to members of the public. The information is of a general nature only and is based on present taxation laws, superannuation laws, social
security laws, rulings and their interpretation as at the issue date of this brochure. The examples used are for illustrative purposes only.
Total Care Plan Super is a component of CommInsure Protection. Taxation considerations are general and based on present taxation laws and
may be subject to change. You should seek independent, professional tax advice before making any decision based on this information.
CMLA is also not a registered tax (financial) adviser under the Tax Agent Services Act 2009 and you should seek tax advice from a registered
tax agent or a registered tax (financial) adviser if you intend to rely on this information to satisfy the liabilities or obligations or claim entitlements
that arise, or could arise, under a taxation law. The CommInsure Protection Product Disclosure Statement (PDS) is issued by CMLA and The
Colonial Mutual Superannuation Pty Ltd ABN 56 006 831 983 AFSL 235025 (“the Trustee”), the Trustee of the Colonial Super Retirement
Fund ABN 40 328 908 469 (“the Fund”). CMLA is responsible for the administration of the Fund and provides insurance benefits to the Fund
as insurer. CMLA and the Trustee are both wholly owned but non-guaranteed subsidiaries of the Commonwealth Bank of Australia ABN 48
123 123 124 AFSL 234945.