SMSF insurance is required by law to be considered for each member as part of your investment strategy. And for good reason too! Insurance exists to protect you, your loved ones and the value of your portfolio.
The types of personal insurance available inside your SMSF are:
- Life insurance: In the event of the death of a member, life insurance will pay out a benefit to the eligible dependents or personal legal representative. This benefit could help preserve the lifestyle and assets of the loved ones left behind. It is also possible to receive a benefit if you are diagnosed as terminally ill.
- Total and Permanent Disablement (TPD): If you are deemed to be totally and permanently disabled by injury or illness and are unlikely to ever be gainfully employed, you may be eligible to receive a TPD benefit.
- Income Protection: If injury or illness prevents you from working for a period of time, income protection can pay out up to 75% of your regular income for the duration of the benefit period.
By holding your insurance inside your SMSF, you can take advantage of the added benefits that come with that insurance structure, such as:
- Tax-deductible premiums. You have the opportunity to reduce your tax bill by way of a tax deduction for the premiums you pay through super.
- Pay for premiums from contributions. The premium is deducted straight from your super fund, which means it is funded by contributions — including employer contributions. So you don’t need to worry about your cash flow being impacted.
We can help you find an appropriate level of cover for you and your family’s needs while employing the use of tax and insurance strategies to minimise costs to your SMSF.