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| Income Protection | Life Insurance | Public Liability | Tool Insurance | TPD Insurance | Trauma Insurance | Business Expense Insurance | Key Person Insurance | Which do I need? |
Frequently Asked QuestionsAs the experts for trades insurance in Australia, we get plenty of questions every day from tradies wanting to know more about insurance. Below we have details the answers to some of the more common questions we receive. General Questions about Trade Risk
General Questions about insurance
Income Protection
Tool Insurance
Public Liability Insurance General questions about Trade Risk Which insurers do you recommend? Unlike some brokers, we don't limit ourselves to specific insurance companies. Instead we have relationships with the majority of insurers and will recommend to you the one that fits your situation the best. After all, the company and policy which best suits a carpenter in Melbourne may not be the best policy for an electrician in Karratha. Are you linked to any particular insurance companies? Other than being accredited with a large range of insurers, we have no other links whatsoever that align us with any particular insurance provider. Trade Risk is 100% privately owned and our licensee (Synchron) is also 100% privately owned with no institutional ownership. Is your advice influenced by commissions? Absolutely not. When making an insurance recommendation, commission rates are the last thing we think about. We recommend the policy that is best for you, end of story. To prove this point, as of November 2010 the insurer we have used the most actually has one of the lowest commission rates in the market! Do you receive any gifts or other kick-backs from the insurers? Not really. I once played a free round of golf with an insurer we've never used, and I had another insurer shout me a pint of beer. Other than that, we do receive the odd free coffee when a representative from one of the insurers wants to talk about their products, but that's all. Who are you licensed or authorised by? "Ultimately we are regulated by a government department called ASIC, which is the Australian Securities and Investments Commission. Our company ASIC number is 345078. Rather than hold our own AFSL (Australian Financial Services Licence) we have chosen to operate under the authority of two separate AFSL holders (known as our "licensees"), one for our general insurance activities and one for our life insurance activities. There are numerous benefits to us as well as our clients in operating in this manner. Firstly, it allows us to spend more time assisting our clients, whilst allowing our licensees to manage our compliance responsibilities and numerous other "back office" fuctions which they conduct. This structure also means that we are backed up by two much larger companies, who will be there to help our clients in the unlikely event that Trade Risk was to cease trading. Our licensee for life insurance (which includes income protection) is Synchron, who have around 150 advisers throughout Australia. Our licensee for general insurance is NAS Insurance Brokers, who have around 70 brokers throughout Australia. Both Synchron and NAS conduct annual compliance audits on Trade Risk and review a number of our client files to ensure we are doing the right thing. Trade Risk is a trading name of Equita Financial Services Pty Ltd, whose sole shareholder and director is Shane Moore. Shane is the person you will most likely deal with when you insure through us, which means you'll always be dealing with the person with the power to get things done. Who do I contact if I have a complaint? This one isn't a frequently asked question (at the time of writing we've never received a complaint) however we do have to include this information. We hope that you'll never have to, but in the first instance you should contact us directly. If you are not satisfied with our response or you do not receive a response within 24 hours (for general insurance) or the first 3 working days (for life insurance) you should contact the relevant licensee listed below: For General Insurance (including public liability and tools) NAS Insurance Brokers For Life Insurance (including income protection) Synchron If you are still not satisfied with the response, or you do not receive a response within 21 days (for general insurance) or 45 days (for life insurance) you should contact the Financial Ombudsman Service (FOS) using the details below: Financial Ombudsman Service
General questions about insurance Can I pay my premiums monthly? Yes! All policies we recommend can be paid monthly, however the premiums may be slightly higher in some cases. Some brokers don't charge extra to pay by the month, why do you? In many cases this is an old trick. The broker simply charges a higher rate for all policies regardless of how you pay. So it seems that you're not paying any extra for going monthly, but the truth is that all of the broker's clients are paying more. Is it okay if I don't tell you everything in my insurance application? It is vitally important that you tell us everything that could effect your insurance application. You may think that lying about having a few smokes during the week will give you a cheaper premium, but if you are caught out, the insurer will have every right to refuse any claim that may relate to your smoking, and may cancel your policy completely. This could have major financial consequences for you and your family. Honesty is definitely the best policy! Income Protection Is accident and illness insurance the same as income protection? "Definitely not! Although the general aim of both types of policy is generally the same - to protect your income - the policies are actually quite different. We could fill a number of pages on the technical differences between the two, but the bottom line is that an accident and illness policy is generally far more difficult to claim on when compared to a proper income protection policy. Another important difference is around the term "guaranteed renewable", also known as "non-cancellable". With an accident and illness policy, the insurer can cancel your policy at any time if they think you’ve become too much of a risk. They can also exclude certain conditions as they wish. For example, say you required a knee reconstruction whilst your accident and illness policy was in-force, the insurer would have to pay you for any time away from work, but at your next renewal they could add an exclusion to your policy stating they will not pay any further claims relating to your knee. If you suffered a minor heart attack or stroke during the policy period, or decided to take up skydiving or some other dangerous pursuit, they may chose not to insure you at all when your next renewal is due. In this case, you may have great difficulty finding another insurer to offer any level of cover to you. With income protection things are very different. Once your policy is in place, and provided there has been no fraud or dishonesty involved, the insurer MUST offer you a renewal each year and they cannot cancel your policy as long as you keen paying the premium. If you suffer a dozen different claims relating to your back for example, the insurer will have to pay you each and every time. Furthermore, they cannot increase your premium regardless of the number of claims you make! Income protection and accident and illness can be very different beasts, so please don’t let your insurance broker try to fool you by selling you a "cheap" policy, as it may cost you a LOT more down the track. Why won't you sell me a cheap accident and illness policy? "We could sell you such a policy, but unlike many insurance brokers who are only licensed to provide advice on general insurance products, we are also financial advisers and therefore have a fiduciary duty to our clients to ensure we are acting in their best interests. Compared with a proper income protection policy, an accident and illness policy generally provides an inferior level of cover, and therefore it is against our principles to recommend or "sell" such cover. To provide advice on income protection in Australia, one has to be a licensed financial adviser. Many insurance brokers are not licensed in this way, and therefore they cannot provide advice to you on income protection. Instead they simply sell you an accident and illness policy. Will I need to get a medical check done? For most of our clients the answer is no. Insurers will generally only require a medical check if you have any existing medical issues, or if you are insuring yourself for a high amount. As you get older there is a higher chance that a medical will be required, and also if you weight to height ratio is considered to be high. This is the period you must be unable to work for before you can claim on your policy. The available waiting periods range from 7 days to 2 years, and the shorter the waiting period the higher the premium. Which waiting period is right for me? The right waiting period depends on your needs and objectives. If you couldn't survive for more that 7 days without pay, then a 7 day waiting period may be right for you. The vast majority of Trade Risk clients have a 30 day waiting period on their policies, as they feel that they could get through the first 30 days using savings or credit cards. A 30 day policy also provides a good balance between affordable premiums and comprehensive cover. This is the period of time over which you will continue to receive monthly benefit whilst you cannot work. The benefit period can range from 1 year, up to an "age 65" policy which continues to pay you benefits until you reach age 65 or until you can return to work, whichever is sooner. There are also some policies now available with benefit periods up to age 70, however these are often restricted to white collar workers. As a general rule, the longer the benefit period the more expensive the premium will be. Which benefit period is right for me? In a perfect world everyone would have a benefit period which covers them through to retirement age, however this is not always possible. For some people it is simply a cost issue, and they would rather save some premium and take a lower benefit period. For others they are restricted to shorter benefit periods, this is sometimes the case with newly self-employed clients as well as those working in unskilled or heavy industrial work. How long until I receive my benefits? All insurers pay your benefits monthly in arrears. This mean that you must wait for one month after your waiting period before you receive any benefits. For example, if you have a standard policy with a 30 day waiting period, you must first get through the first 30 days (for which you will receive no benefits) after which you must wait for one month, and then you will be paid one month's benefits. This cover is optional on most income protection policies, and means that in the event of an accident you will be back-paid to day 1 of your claim. Under a standard policy you do not receive any benefits for the waiting period, but with the day 1 accident option you will be back-paid for the entire waiting period. Another benefit is that you do not have to be away from work for the full waiting period, and instead you only have to be away from work for 4 consecutive days in order to make a claim. Beware of some insurers who also offer day 1 accident cover, but instead of having a 4 day period they have a 14 or 30 day period. How much can I insure myself for? The majority of insurance policies will allow you to cover up to 75% of your income. The income they will insure is commonly known as your "personal exertion" income, this means that it is income that has been earned through your physical efforts, and would be unlikely to continue if you were unable to work. How will the insurer determine my benefit? Each insurer has slightly different rules in how they will determine your benefit in the event of a claim, but essentially you will be paid 75% of your pre-claim income, or your monthly sum insured, whichever is lower. A common method for determining your pre-claim income is to use you most recent 12 month's earnings, whilst some more generous insurers will allow you to use your best 12 month continuous period from the last 3 years. How will the insurer determine my benefit if I am newly self-employed? Only a small number of insurers will offer income protection if you have been self-employed for less than 12 months, and thankfully we know who they are! Of those who will offer cover, generally they will use your average monthly earnings from the start date of your policy through to the date of your claim. As most people will not have completed tax returns or financial reports during the first 12 months the insurers will allow alternative methods of proving your income, such as client invoices, contracts or BAS Tool Insurance How much should I cover my tools for? It is important that you insure your tools for their full replacement value. That's not the price you could sell them for on eBay, but the price you would have to pay if you had to purchase each and every tool again. Don't just think about the big power tools, remember all the little bits too, as these can add up very quickly when their replacement cost is used. Which events will my tools be covered against? The policies do vary slightly, but the majority of our policies will cover your tools if they are stolen, but only if there is physical evidence that forced entry was required to access your tools and equipment. Basically this just means that you need to keep your tools locked up if you want them to be covered. The policies will also cover you for fire and storm damage, as well as damage caused in a vehicle collision or rollover. Do I have to list all of my tools? Each insurer has slightly different rules, some require all tools over $1,000 be listed on the policy, whilst others have a threshold of $2,000 or $3,000. We will let you know exactly which tools need to be listed, and we will also provide you with a handy tool register to keep track of your tools. Public Liability Public liability insurance covers you when someone tries to sue you as a result of your work. Examples could be an electrician damaging someone's appliances or burning down their house, or an carpenter who leaves a power cord across the hallway that someone trips over, or a landscaper who digs a ditch that someone falls into. There are a million different things that can go wrong on the job, some of them are fairly harmless, but others can be huge and finish up in court with multi-million dollar settlements.
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Tradesman Insurance
 Income Protection
Life Insurance
TPD Insurance
Trauma Insurance
Business Expense Insurance
Public Liability Insurance
Tools Insurance
Key Person Insurance
Which ones do I need?
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| Important Information:
Information on this website should be seen as general advice only, as it does not take into account your personal circumstances. You should not act upon any information on this website without first consulting a qualified financial adviser or insurance broker
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