Superannuation funds are providing second-class products in their efforts to offer income protection insurance for as many members as possible, but financial advice and segmentation are the solutions, Rice Warner says.
According to the firm’s latest Insights blog, a number of super funds fall short of having income protection insurance that is “adequate” and provided at a “reasonable” cost. Most levels of cover are generally short-term (benefit periods of 2 years) and the sums insured don’t provide full replacement of income, yet without the cover offered through their super funds many Australians would have no cover at all, Rice Warner said.
The firm adds that superannuation funds have little knowledge of their members’ current and changing personal circumstances, which is necessary when determining how much income protection cover is needed.
Read the full article here: Independent Financial Adviser
