Underinsurance - your five-step treatment


Perpetual Private Insights

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As a medical specialist, YOU are your biggest asset, so here are five important considerations to help you safeguard against the unexpected:

  1. Your insurance isn’t a ‘set and forget’ policy

    While most medical specialists have some personal insurance, we often find it hasn’t been reviewed since they started working.

    Given the life changes of a medical specialist – a significantly higher income, higher debt, a family, running your own practice – there’s a great deal riding on your ability to keep working.

    That’s why it’s vital that you’re covered by an appropriate level of personal insurance, such as income protection, trauma, total and permanent disability, and life cover.

  2. You may need to claim sooner than you think

    Did you know that the average age of income protection (IP) claims in 2015 was only 39 – and that, on average, the IP policy was in place for just 3 ½ years before a claim was made?*


    So were we. But surely trauma claims were different?

    Sorry, same story – the average age of trauma claimants was only 43, with an average policy in place for just under 6 years.*

    These statistics demonstrate the urgency of having the appropriate cover in place earlier than you may think necessary.

    *Source BT Life – Breakdown of 2015 income protection and trauma claims


  3. You should be in control of your policies

    Insurance policies are usually owned either personally, or through superannuation, in which case they are owned by the Trustee that manages that superannuation account.

    Depending on your circumstances, it may be beneficial to have your insurance policies owned and managed within your superannuation, however it does mean you forfeit some control. Should you need to make a claim, this lack of ownership could prolong the process as well as affecting the ultimate outcome of the claim.

    Additionally, there are some specific tax implications for Total and Permanent Disability (TPD) insurance owned via super that you should consider before choosing your policy ownership.


  4. You can’t afford to neglect the Ts & Cs

    Having enough insurance cover is important. Having the right insurance is vital, as not all insurance policies are created equal.

    Just like product information documents, it’s the fine print within these policies that really matters.

    For example, if your TPD insurance covers ‘any’ occupation, rather than your ‘own’ highly-specialised occupation, then you and your family could be left significantly short at claim time.

    It may seem insignificant but in the context of being unable to return to your ‘own’ highly-specialised occupation due to illness or injury, a TPD policy including an indefinite word such as ‘unlikely’ may significantly increase the probability of you receiving the right compensation.  This slight change, could be the difference to you, in time, returning to your skilled occupation or having to take on a much lesser role in your field.  


  5. Your practice needs protection too
  6. We often find medical specialists don’t have any business expenses cover in place. If they do it’s usually nowhere near enough to keep their practice running, should they be unable to work due to illness or injury.

    That’s why it’s crucial you have appropriate business expenses cover to ensure you have a practice to return to when you have recovered.

Your treatment plan

If anyone knows the havoc that an accident, injury or illness can cause, it’s you. To protect your financial health, you can’t afford to neglect your personal insurance.

As medico-specialist financial advisers, we understand the unique risks faced by medical specialists each day. To protect you, your family and your practice, remember to:

  • Review your current situation and make sure that your level of insurance covers your needs
  • Understand the pros and cons of how your policies can be structured to help you determine what is appropriate for you
  • Be clear on all policy definitions, as these may influence the success of your claim
  • If you run your own practice, make sure you have the right business expenses cover in place, so you have a practice to return to


Speak to one of our medical specialist financial advisers to find out how you can put the right insurance plan in place to protect you, your family and your practice.

Perpetual Private advice and services are provided by Perpetual Trustee Company Limited (PTCo), ABN 42 000 001 007, AFSL 236643. This publication has been prepared by PTCo and may contain information contributed by third parties. It contains general information only and is not intended to provide you with advice or take into account your personal objectives, financial situation or needs. The information is believed to be accurate at the time of compilation and is provided by PTCo in good faith. You should consider whether the information is suitable for your circumstances and we recommend that you seek professional advice. To the extent permitted by law, no liability is accepted for any loss or damage as a result of any reliance on this information. PTCo does not warrant the accuracy or completeness of any wording in this document which was contributed by a third party. Any views expressed in this document are opinions of the author at the time of writing and do not constitute a recommendation to act. Past performance is not indicative of future performance.