Was thinking about changing my super industry fund to a bt wrap account or similar, with the main reason my income protection costs over $200 a month. I have the quote and paperwork for bt. But starting to think some thing like esuper/smsf could be the way to go. Is there anyone here with income protection in there smsf or knows for a fact you can do this with esuper or with another smsf company. Cheers
Hi Franko Yes you can purchase income protection insurance, paying the premiums using money in your SMSF. It has to be permitted by the trust deed but it is almost inconceivable that it would be missing from the deed. I would be interested to know whether you find that you have a better choice of cover through an SMSF, and whether the premiums are any better.
One thing you have to look out for is the possible cancellation clause. Some policies have a clause that enables the company to stop payments after 1 year. - not something you want to have happen if your faced with a long term illness or have a major accident.
My advisor said SMSF should definitely pay for members TPD insurance, but not income insurance. Apparently it is frowned up because of conflicts of interest. I was advised to pay for income protection out of personal income, and claim back as a tax deduction.
Thanks guys I know income protection is not ideal in super my partner is a para planner and she thinks you are better off with it out of super. I would just prefer to have it in super and was curious if any one with a esuper smsf had it already. For the price esuper are charging I don't think it to be too much of an issue where my partner works they charge about 2k a year in fees for a smsf. So if I don't get it in esuper I think I could live with the trade off in fees. As you might be able to tell I have decided today to start a esuper smsf anyway.
My super has a income protect............. http://www.maritimesuper.com.au/WebPage/ProductsAndServices/frmInsurance.aspx