Understanding Your Insurance Premiums
A comprehensive guide to understanding and managing your Insurance Premiums.
Premiums and managing the ongoing cost of your cover
Click on a topic below to find out more.
The premium you pay depends on your circumstances, including but not limited to:
• The amount of cover and the type of insurance benefits selected
• Your age – premiums generally increase with age as the likelihood of a claim increases
• Your gender
• Your occupation
• Whether or not you smoke – premiums are higher for smokers
• The options and selections you make when taking out your cover, including the chosen Waiting Period and Benefit Period for Disability Income Insurance – premiums are higher for shorter Waiting Periods and longer Benefit Periods
• The frequency of premium payments you choose (monthly or annual payments are available)
• When your cover started, and
• Your state of health, family medical history, lifestyle, leisure activities, and other relevant factors considered during the assessment of your application (premium loadings may apply).
Monthly premiums can be paid by direct debit from your nominated bank account or by VISA or MasterCard. Annual premiums can be paid by cheque or direct debit.
Future premium rates are not guaranteed to remain the same as current rates. We reserve the right to change premium rates for all policies in a particular category. Our premium rates are available on request.
All the fees and charges for providing you insurance cover are included in your premiums and there is no additional fees and charges payable by you.
The fees and charges include:
• Distribution Partner remuneration: When you purchase your insurance product through a distribution partner or in response to a marketing partner campaign, we may pay remuneration to that partner in respect of your cover.
• Administration fee: The Trustee receives a fee (being a percentage of the premium) for providing administrative services.
• Frequency loading: Monthly premiums include a 5% loading. There is no loading if you pay your premium annually.
There is no cancellation fee if you cancel your cover. You may be entitled to a refund of the unused annual premium paid in respect of the period between the effective cancellation date and your next policy anniversary.
Insurance premiums attract State stamp duty at different rates for different products. This charge is included in the premium and we will be responsible for these payments.
There is no GST payable on your premiums.
Your premiums for Life, TPD and Trauma Insurance are not generally an allowable deduction from your assessable income. Any benefits you receive from these insurances will, in most instances, be tax-free.
Your premiums for Disability Income Insurance and Business Expenses Insurance are generally tax-deductible, and any benefits received from these insurances are paid gross and are tax assessable to you.
Of course, individual circumstances can be different, and also taxation treatment is likely to differ where cover is taken under superannuation, so we generally recommend that you seek professional taxation advice if in doubt about your situation. These tax statements are necessarily general in nature and based on the continuation of present taxation laws and their interpretation.
NobleOak offers stepped premiums which means that the premium generally increases each year with age. Where premiums increase, your premium will not change before your next policy anniversary.
We may change the premium rates at any time. Any change to premium rates will apply to all policies in a defined group. We’ll not single you out for a change in premiums.
If we change the premium rates, we’ll write to you to let you know at least 30 days before the change takes effect.
NobleOak offers a stepped premium structure for you to pay for your cover. Stepped premiums generally increase at each policy anniversary to reflect the increasing likelihood of a claim. This means the premium you pay each year will increase as you get older.
Your premiums vary each year depending on your age, your sum insured and our premium rates at the time. If we change our premium rates, the new rate will apply
to you from your next policy anniversary date after the change.
However, we understand that at times paying your insurance premium may become difficult or your needs may change.
If you are experiencing financial hardship, we may be able to waive your premiums for up to a maximum of 3 consecutive months, keeping your insurance cover in place at a difficult time. You will need to provide supporting documentation to assist with your financial hardship application.
• Your cover needs to have been in place for at least 24 months,
• You must not have increased your sum insured in the last 12 months other than by indexation,
• Your cover is not held under superannuation,
• You are paying premiums monthly, and
• You are not receiving – and have not received at any time in the prior 12 months – income disability insurance or income protection insurance payments from NobleOak and have not lodged a claim for such benefits.
The waiver is only available in limited financial hardship circumstances. These circumstances may include where:
•You have been retrenched or made redundant from your employment,
• You have been declared bankrupt,
• You are suffering financial hardship as a result of family or domestic violence or the death of a spouse, partner or child or
• A natural disaster or health pandemic has inhibited your ability to undertake your usual work and you have not found alternative work.
Please call us on 1300 396 455 to discuss whether you may be eligible for a premium waiver on the basis of financial hardship. We reserve the right, acting reasonably, to require specific evidence of your financial hardship circumstances. Importantly, a premium waiver for financial hardship will not be granted retrospectively – that is, it cannot be used to excuse any prior instance of non-payment of premium. You must keep paying premium until the waiver is granted. If a waiver is granted, it will specify the date from which it is effective, and how long it applies for.
Your policy offers a variety of options should you wish to manage the cost of your premiums, but still stay protected. Some of the options you may wish to consider are:
| Maintain your current cover | Your cover will remain unchanged, and your premium payments will continue to occur as scheduled.
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| Revise your benefit amount | You may no longer need the level of cover that you currently have. You may decide that you could reduce your cover amount.
Please note: If you do decide in the future to increase the benefit amount again, it will be subject to underwriting at the time.* You will be asked questions about your lifestyle and any current health conditions, including those that have arisen since you took your cover out. As a result, you may have to supply additional medical evidence. * Unless it is an increase to TPD cover of the lesser of $100,000 or 20% of your cover amount as a result of an allowable event, under the Future Increases Benefit.
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| Change your waiting period | If you hold Income Protection cover the waiting period on your policy is the length of time that you must be disabled before we will commence paying any Income Protection Monthly Benefits after you make a claim. Information about the waiting period is in your PDS and you would have chosen either a 30- or 90-day waiting period when you took out your policy.
Generally, the shorter your waiting period, the more expensive your premiums. If you originally chose a 30-day waiting period and you increase your waiting period to 90 days, this will reduce your premiums.
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| Amend your benefit period | If you hold Income Protection cover, the longer your benefit period (to age 65) the higher your premiums will be. The benefit period is the maximum length of time that we will pay your claim should you become ill or injured, whilst you remain unable to work during that period.
You may be able to reduce your benefit period to reduce your premiums. Importantly, you need to consider the fact that if you reduce your benefit period, the amount of time during which you will receive monthly benefit payments whilst you remain unable to work, will be reduced.
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| Change your payment frequency | If you pay your premium monthly, you can change it to an annual payment frequency. As noted in the PDS, monthly premium payments attract a 5% loading which does not apply if you pay annually.
If you don’t want to pay your premium in an annual lump sum, you can pay monthly to help you spread the cost out over the year.
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| Opt out of indexation | Benefit amounts and premiums are automatically increased at each anniversary based on the increase in the Consumer Price Index (CPI) or 3% (whichever is the greater), known as indexation. You can request to have automatic CPI increases switched off, which will prevent the cover increase (and the corresponding premium increase, for the greater amount of cover) occurring from your next anniversary.
This means your sum insured will no longer increase in line with CPI automatically at each plan anniversary date. However, you will have the option to switch the increase back on in the future, at renewal time, if you decide to do so.
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| Choose to take a premium freeze | If you hold TPD cover, you can fix the cost of your cover by contacting us to freeze the premium amount. This means that your future premiums will be fixed at the amount you were paying on the date of notification, and each year your cover amount will be reduced to the amount of cover that can be purchased for the frozen premium amount. You can contact us at any time to end the premium freeze (if so, it will end on the next anniversary of your cover). | |
