The three types of insurance cover available through your super fund are designed to complement each other, depending on the nature of your illness or injury. These are:

• Life – this pays a lump sum to your beneficiaries in the event of your death or diagnosis of terminal illness.
• Total and permanent disability (TPD) – pays a lump sum if you become seriously, permanently disabled and are unable to work again.
• Income protection – also known as salary continuance insurance, provides regular payments (usually a percentage of your normal salary) for a specified period if you are unable to work due to temporary illness or disability.

Some people think they don’t need their own insurance cover at all because workers’ compensation (WorkCover or WorkSafe), Medicare or private health insurance will look after them. That simply isn’t the case:

It’s called different things in different states, but one thing is true all over Australia: workers’ compensation schemes only cover you while you’re working.

Medicare will cover some of your medical costs if you’re injured or ill, but it won’t replace any lost income or help you pay other bills.

You may have extras cover that pays for some medical and rehabilitation services Medicare won’t cover. But even the most comprehensive health cover won’t provide any income or pay regular living expenses.

1. Write down your household expenses for each month.
2. Multiply these by 12 to understand your yearly expenses
3. Then multiply these by how many years you’d like these expenses covered if you fell ill, were injured, or passed away.
4. Take away any other income that would continue if something happened to you.
   

It’s important to remember that this is only a general estimate of the cover you might need and other things need to be considered too, such as debt levels and interest rates, plus other things that impact your expenses. But it gives you a good idea.

The insurance you have in your super gives you some cover, but depending on your circumstances it might not be enough.

If you don’t think you have enough cover, it’s important to address this as soon as you can. Talking to a financial planner can help you understand your situation and make confident financial decisions (big or small) so you can get the most out of life.