Insurance myths

There's a few misconceptions about life insurance - like 'insurers don't pay claims', or 'insurance is too expensive'. Some people even think 'insurance isn't for me - I don't need it!'

In fact, the opposite to each of these statements is true!

  • insurers do pay claims
  • insurance is more affordable than you think
  • yes, insurance is for everyone - not just people who have kids and a mortgage!

Let's debunk those myths and get the facts. If you're making decisions about protecting your family, you'll want to base your future on fact - not fiction.

Myth 1 - Life insurance companies don't pay claims!
Myth 2 - Life insurance is too expensive
Myth 3 - I'm young and healthy - so insurance isn't for me
Myth 4 - Thanks, but I've got enough life insurance cover in my super fund
Myth 5 - I'm covered by my private health insurance
Myth 6 - The government will look after me if I get sick

Myth 1 - Life insurance companies don't pay claims!

At Asteron Life, we pride ourselves on delivering on the promise we make to you when you take out a policy. In 2012, we paid more than $248 million in total claims to around 3,110 customers Australia-wide.

The whole life insurance industry pays out almost $10 million every working day in claims to customers. This figure would be even higher if the Australians had adequate levels of cover. Source: www.lifewise.org.au

Myth 2 - Life insurance is too expensive

For most Australians insurance is very affordable! For less than the price of a cup of coffee a day, you can get a substantial amount of cover to protect your family's lifestyle. And, of course, the benefits of having life insurance can far outweigh the costs!

For just $1 a day you could get a substantial amount of Asteron Life Complete Life Cover.

Age Amount of cover for men Amount of cover for women
30 $415,145 $774,750
35 $420,830 $692,730
40 $379,269 $588,820

Assumptions: non smoker, stepped premium, paid annually.

Myth 3 - I'm young and healthy - so insurance isn't for me

Life insurance can help people of all ages, and from all walks of life - it's not just for parents with kids and a mortgage.

Even if you're young, single and healthy today, insurance is important to help you protect your lifestyle, your independence and cover your debts - in the event that you need to.

Insurance policies like Income Protection or Trauma can help you cover the bills, pay your rent or mortgage, cover medical expenses and continue to fund your lifestyle if you can't work because you get sick or injured.

Find out more about insurance for the different stages of life

Find out more about the different policy types

Myth 4 - Thanks, but I've got enough life insurance cover in my super fund

You probably don't have enough cover in your super fund. You may have some life insurance (death cover) through your super policy, but on average people with cover through super have less than half the level of cover they need.1

Insurance through super also usually doesn't give you access to all insurance types - like Income Protection or Trauma cover.

You should contact your super fund, or check your annual statement, to see what level - and types - of cover you already have. Then speak to a financial adviser about whether this is right for your needs.

1www.lifewise.org.au

Myth 5 - I'm covered by my private health insurance

Private health insurance provides valuable protection against the medical expenses associated with sickness and injury. But this is where it starts and stops: it's for medical expenses only. It won't cover your bills, debts or replace your lost income if you have to take an extended period off work due to illness or injury.

Private health insurance also may not cover the total cost of your treatment, or rehabilitation - potentially leaving you with a 'gap' that needs to be paid out of your own pocket.

To ensure you have no insurance gaps, a complete protection plan should encompass both private health insurance and life insurance.


Myth 6 - The government will look after me if I get sick

The Government, through Centrelink, provides financial assistance for people who suffer a serious disability.

But the Disability Support Pension doesn't go far and there are rules around who is eligible for it.

From 20 September 2009 the Disability Support Pension for a single over age 21, or under 21 with children, is $671.90 per fortnight.2

At $17,469 per annum, that's around a quarter of the average full-time income of $62,270.3 This could leave you with a funding gap when it comes to covering the bills, your rent or mortgage, medical expenses and your lifestyle.

Maximum rate of Disability Support Pension

  • For people aged over 21, or under 21 with children
Status Pension rate per fortnight
Single $671.90
Couple $506.50 each

For more information about the Disability Support Pension visit www.centrelink.gov.au

2 Payment rates appear as a guide only and are effective from 20 September 2009 and include Pharmaceutical allowance - www.centrelink.gov.au
3 Average Weekly Earnings, Australia May 2009, ABS, Catalogue 6302.0 www.abs.gov.au

Asteron Life™ is committed to providing customers with long term financial security. We provide life insurance products including Income Protection Covers, Trauma Cover, Total & Permanent Disablement (TPD) Cover, Life Cover and Business Expenses Cover. We are committed to helping customers get - and stay - healthy for life, by giving customers access to the Asteron Life Wellbeing Program. To obtain a copy of our privacy statement, please contact us on 1800 221 727 or visit the following website www.asteronlife.com.au/privacy to view or download the policy.