We help make sure you’re covered, just in case
As your life progresses and you take on more responsibilities, your need for insurance protection grows. Whether it’s insuring your home, your car or your business, insurance gives you the peace of mind that comes with knowing you and your loved ones are taken care of financially if something unexpected happens.
We understand the importance of finding the right insurance coverage to fit your needs. We work with you to find the best personal and business insurance policies to protect you and everything you’ve worked so hard for. Contact us today to learn more about the different types of insurance coverage we offer and how we can help you find the right solution.
- Key Person Insurance
- Buy/Sell Insurance
- Business Insurance
- Succession Planning
- Life Insurance
- Total Permanent Disability (TPD) Insurance
- Trauma Insurance
- Income Protection
- Child Cover
- Claims Management
HOW WE HELP
Key Person Insurance
A ‘key person’ is someone who’s continued association with a business provides that business with a significant and direct economic gain. Economic gain means more than just profits. It can, amongst other things, also include cost savings, capital injections, goodwill, access to credit and access to customers.
The owners of a business will usually be key people. Key people can also include:
- Managing director
- Sales manager
- Financial controller
- Computer programmer
- Specialist engineer
- Famous actor
- Working director
- Silent partner
Most businesses take out insurance cover for assets that do not actively make them profits – their plant, equipment vehicles and buildings. It is the human asset that, through initiative, drive, skill, specialist knowledge and ingenuity which, can actively generate profit from your business.
Key person insurance can compensate the business for loss of two different qualities:
- business profitability (revenue purpose), and
- the capital value of the business (capital purpose)
Note: The type of policy used can impact on the taxation treatment of the premiums and proceeds.
Buy/ Sell Insurance
A buy-sell agreement involves the business owners entering into a written agreement to plan what they are to do with their respective interests in the business should any one of the owners die, become disabled, suffer a traumatic or terminal illness, resign or retire – just like having a will in place for the business.
Essentially the agreement should provide a mechanism whereby the terminating business owner can sell his or her interest in the business to the continuing owners, and whereby the continuing owners can purchase the terminating owners interest in the business.
The agreement generally also recognises the means of funding the buy-sell obligations of the respective owners.
The death, Total and Permanent Disablement or terminal illness, resignation or retirement of an owner can have a dramatic effect on a business. While resignation or retirement cannot be specially insured against, sudden death, total and permanent disablement or terminal illness can be insured through the Buy-Sell Agreement.
Note: All Buy-Sell Agreements should be written under legal advice.
Stan & Oliver’s Story
In 2003, Stan and Oliver started a business together. The start-up capital and purchase of business assets was valued at $500,000. Stan developed the business products and services. Oliver managed the administration and key relationships with their clients. Two years later Oliver died from cancer. The business value had increased to $1,500,000. Stan wanted control of the company, but Oliver’s wife, Wilma, wanted a fair value for Oliver’s share in the company, which she had inherited upon Oliver’s death.
Wilma refused to sell her shares to Stan unless he paid what she wanted. Stan said that he couldn’t afford to purchase the shares at the price Wilma was asking, as he couldn’t get financing from the bank now that Oliver had gone. Wilma looked to sell her shares to an outside party, but as there were problems with the business, she had difficulty obtaining a fair value. Wilma was forced to work in the business with Stan in order to support her and the family. Stan resented her being part of the business since she had no expertise in the industry. He felt he was doing all the work and sharing the profits with her.
Had Stan and Oliver taken out an appropriate amount of insurance, Stan could have paid Wilma for the shares and been free to run the business on his own. Wilma would have had funds to live on and would be free from the involvement in the business.
An appropriate amount of insurance would be 50% of the business value at a cost to the business. Provided by CommInsure Claims.
Business Expense Cover
Business expense cover provides for 100% of fixed business expenses if the business owner becomes totally disabled due to sickness or injury.
Business expense cover is specially designed for the self-employed individuals or members of a small business who need to cover their fixed business expenses if they cannot work due to sickness or injury. It is vital for sole proprietors, who are generally responsible for 100% of the fixed expenses of the business. It is equally important for small partnerships to ensure that each partner is covered for his or her share of business expenses. Premiums are generally tax-deductible.
Fixed operating expenses of running a business include:
- Accounting & audit fees
- Bank fees & charges
- Business Insurance premiums
- Business loan repayments
- Cleaning & Laundry
- Computer servicing expenses
- Contracted advertising
- Contracted repairs & maintenance
- Courier Costs
- Equipment & vehicle leaving
- Land tax
- Postage Printing & Stationery
- Professional fees & subscriptions
- Property rates
- Salaries & Superannuation
- Workers Compensation
Succession Planning is actually about putting in place a strategic business plan for your business which allows you to outline your business and personal goals. These goals relate directly to your ability as a business owner to extract the maximum amount of value from your business when you exit, to provide for your retirement planning needs.
If you do not have a strategic approach to business succession planning – any value you have been able to build into your business may well retire when you do!
It is important that a Buy-Sell Agreement or Business Will be set up with legal advice.
How is a Buy-Sell Agreement set up?
1. The business owners negotiate and agree on:
- The trigger events
- How the interest in the business will be valued and
- The respective buy and sell obligations of the business owners should a trigger event occur.
2. A funding plan is established to provide the cash to achieve the financial obligations of the business owners should any of the trigger events occur.
3. The legal documentation is prepared.
If someone depends on you financially, chances are you need insurance. It is important to protect yourself and your loved ones from finanical stress if something happens to you. Life insurance results in a lump sum payment upon the death of the person insured. If a family were to lose the major income earner, it’s critical that the remaining family members are able to financially survive without having to sell assets, rely on others or rely on welfare.
Life Insurance is not just for the main income earner, if your partner takes care of the children and your home and your partner were to pass away, you may require substantial funds to cover expenses to keep the household going. Expenses like child care and housekeeping etc.
Michael (28) recently took out a Life Insurance policy. His father had died suddenly at age 46 from a heart attack when Michael was just 16, leaving his mother to support him and his younger siblings. It was their father’s foresight to take out life insurance that helped the family survive this tragic event. The lump-sum payment ensured that money was the least of their worries.
The day after Michael’s wife, Susan, announced she was pregnant with their first child, Michael spoke with his financial adviser about choosing the right kind of insurance. The life cover he took out means that if the worst does happen, Susan and his future children will have the same financial security that Michael experienced after the loss of his father.
His adviser also mentioned the option that they consider Child Cover when their child turns two years old. This would mean that if their toddler became ill in the future, they would be able to focus their energies where they were needed – on their child not the finances. Source – CommInsure Claims.
Total & Permanent Disability – TPD
Have you thought about what would happen to you if you became totally and permanently disabled?
Would you be able to meet your financial commitments and maintain your quality of life?
Total and Permanent Disability Insurance is normally an optional extra cover on a Life Insurance or Trauma Insurance policy and commonly covers against you being permanently unable to work in your chosen occupation.
Working as an Electrician, Jeremy (35) is involved in a serious car accident on his way home. The accident causes a major head trauma, leaving him permanently disabled.
Jeremy now suffers from weak limb movements on his right hand side and can no longer continue work as a Electrician. Living on the third floor in a small block of units, the only access to his unit is via the stairs. This is not ideal as climbing stairs causes Jeremy great pain. Once released from hospital, Jeremy makes the decision to look for a unit with ground floor access. Because he owns his unit, there could be a delay before the sale proceeds can be used to put a deposit on a more suitable apartment.
Fortunately for Jeremy, he’d thought ahead and taken out TPD cover when he began his Electrician career.
In this case of severe disabilities such as Major Head Trauma, TPD cover will give him the necessary cash when he needs it most. Provided by CommInsure Claims.
If you’re diagnosed with a critical illness or crisis, trauma insurance can relieve some of your financial burdens. Unlike income protection insurance, which is dependent on your inability to work, trauma cover is paid out on the diagnosis of a defined critical illness regardless of your working status.
Instead of receiving a monthly income stream, you are paid a lump sum that has no restrictions on what this can be used for. The insurance company makes no demands on how you spend the money. Trauma insurance is often an addition to life policies.
Tom is a successful lawyer and is married. He has worked hard over the past ten years to accumulate valuable assets. To support his desired lifestyle, Tom decided on a $300,000 Trauma policy but decided against indexation.
Unfortunately, last year Tom was diagnosed with prostate cancer and was unable to work for six months while he underwent treatment and recovered from the illness. This meant Tom had to rely on his wife’s income.
Tom was paid a Trauma benefit of $300,000 from his policy, which assisted with his recover. Tom continued to pay his annual policy fee and twelve months after the initial payment of Trauma benefit, Tom bought back his $300,000 Trauma policy at standard premium rates.
Unfortunately, six months later Tom had a serious accident at work and suffered a major head trauma. Tom was relieved that, as a result of the Trauma policy, he was awarded another Trauma benefit of $300,000. Provided by CommInsure Claims.
While life insurance cover will provide benefits to your family upon your death, what happens if you can’t work because of illness or an accident and it’s going to take months to recover? Or maybe you can never work again and you’ve got school fees to pay, food to buy and a mortgage hanging over your head.
This is when you need income protection insurance, otherwise known as disability insurance. It’s estimated that you will earn around $1million over your working life, so it would be fair to say that your income needs protecting more than your home and your car. This is even more so, given that at the age of 35 you are 10 times more likely to be disabled than die.
Income Protection will pay a monthly benefit of 75% of your Pre-Tax income (maximum amounts apply). There is a range of options that can be considered to provide you with peace of mind. Your premiums are generally tax deductible.
Jenny (29) was enjoying a week’s holiday from her role as an investment analyst. She and 3 of her friends had decided to visit the snow during the peak of the season. While an accomplished skier, Jenny hadn’t considered the crowds of beginners on the slopes, in particular one new snow border that crashed into Jenny, sending her flying down a black run!
The combination of two broken ribs, a fractured pelvis and a punctured lung, extended Jenny’s absence from work from a week’s holiday to four months sick leave. And because the accident hadn’t happened at work, Workers Compensation didn’t cover her.
Luckily, Jenny had taken out an Income Protection policy 12 months earlier. She received the equivalent of 75% of her income for the 15 weeks she couldn’t work. This allowed her to keep up with her rent and car payments without having to dip into her savings, or borrow from her parents. Provided by CommInsure Claims.
It is a natural desire to want to wrap your child up in cotton wool and protect them from harm. But while cotton wool might protect them from sticks and stones, children are just as much at risk of suffering a traumatic event as adults.
Child Cover pays you a tax-free lump sum if your child suffers specified child trauma events. While money can’t buy a quick recovery, it can ease financial pressures you may face during an emotional time. Private Health Insurance only covers hospital stays and some medical/extras expenses. It won’t cover rehabilitation, alterations to your home or long-term nursing care. For as little as a cup of coffee you could cover your child for $50,000.
Annie’s parents thought she had the flu. When the symptoms persisted for some time, they returned to their GP for some blood tests. The results showed that she had leukaemia. Annie was in and out of the children’s hospital on a regular basis and had chemotherapy for twelve months. Finally, after two years, the doctors gave Annie an optimistic prognosis.
Annie’s parents, Julia and Michael, suffered a lot of stress and worry during this time. Fortunately, Julia and Michael didn’t have to worry about financial issues as well. Julia and Michael had taken out a Child Cover policy which paid out a lump sum payment of $75,000.
With this money they were able to cover:
- Julia giving up her job so she could fully care for Annie
- hotel stays so Julia and Michael could be close to the hospital
- a live-in nanny to look after their other children
- a much-needed family holiday to the Gold Coast once Annie had recovered
Julia and Michael were relieved they could give Annie and her siblings all the attention they needed during a very traumatic time. Provided by CommInsure Claims.
“Let us take the pain out of your claim”
The most important part of the Claims Process is to CONTACT US as soon as possible. We will help you through the process every step of the way.
Some of the information we will need when you call will be:
- What is the injury or illness?
- What was the date you first visited the Doctor for your injury or illness?
- What date did you cease working?
- How long do you expect to take off work?
With this information we will request a Claims Pack to be sent to our office.
On receipt of the Claims Pack we will make a time for the adviser to complete these forms with you personally. A step by step Claims Guide will be included in the Pack.
You will have most of the information required for these forms. Included in the pack is a form that will need to be completed and signed by your Doctor. It will be important for you to make a time with your Doctor to have this form completed.
Be prepared to supply income verification:
- Self employed will need 2 years Tax Returns (for indemnity policies only)
- PAYG employees will need 2 current payslips
When all documentation is complete we will send all of your completed forms to the Insurer for actioning.
A Claims Manager from the Insurance Company will contact you directly to discuss any further requirements.
Our Audit Shield offers you peace of mind in the event you are selected for an Audit.
We offer all our clients access to the Audit Shield service which provides for the payment of professional fees incurred in the event that you are selected for an audit, enquiry, investigation or review instigated by the Australian Taxation Office (ATO) or other relevant Government authorities.
The cost of being properly represented can be quite considerable depending on the circumstances. Even a simple enquiry can require hours of work.