Cost of insurance is highest concern

When the client has nominated they are more concerned about the cost of insurance:

The following methodology will be applied by PrimeSolve to generate needs recommendations:

1: Life – Human capital method will be applied;

2: TPD – Human capital method + upfront medical costs in the event of total and permanent disablement. Budget care is assumed.

3: Income protection

a) Client is working – The default amount is 75% of gross salary + 10% superannuation contributions.

b) Client is at home – Assume income protection (home duties policy). The default for sum insured is based on:

i) Does the client/s have children? If a client has children pre-school age, it is assumed that a nanny would be required full time.

If a client has live in children who are at school, it is assumed a part time nanny would be required.

The cost of a nanny is assumed to be:

Full time – $70,000

Part time – $40,000

ii) An additional cleaning allowance of $150 per week is also assumed.

4: Trauma

a) If client is working we do not cover the gap from Income Protection due to cost concerns.

b) Cover lump sum for trauma events with the highest probability of occurring. These are:

5: Business expenses

If business expenses is in scope, the sum insured is based of the expense figure for each company. This is found on the Fact Find under “Other Entities”.

6: Business succession insurance (Life & TPD)

If business succession is in scope, Life & TPD needs for the business are calculated based on the buyout value of each shareholder. To calculate the buyout amount we multiply the following for each key person:

“Percentage shareholding x Value of business”.

The percentage shareholder is found within the Fact Find at the following section:

The value of the company is based on the following estimate:

7: Key person insurance

The maximum income protection policy is assumed (75% + 10% superannuation) for each key person within the business. A client must enter a key person within the Fact Find under the company section for recommendations to be generated.