Insurance law Sydney refers to people seeking risk management. Some people may think that it’s optional to engage with insurance law in Sydney and opt to self-insure. However, without insurance, banks will think twice about providing insurance expenses to buildings and properties. This may result in businesses or corporations never existing in the first place.
Essentially insurance can help people pay for costly expenses when something bad happens. Think of it as a safety net whenever someone suffers from theft, car accidents, or even lawsuits. Basically, an insurance provider can provide an insurance policy. This is essentially a contract that follows the insurance law in Sydney. Read more about insurance law in Sydney below.
Insurance Law Sydney: Benefits Of Insurance
Insurance is an essential tool in the world of finance. It essentially allows people to have fewer worries knowing they have financial assistance in the event of an accident. Hence, this helps them recover faster from possible future injuries or damages. Moreover, insurance law in Sydney governs different types of insurance that people can avail..
Life Insurance
When a person passes away, life insurance can assist relatives and family members by paying out a lump sum. People can select the proper amount that covers their financial needs like paying off debts. They can also leave a lump sum which the deceased’s families can invest in.
Most insurance companies will require a complete application that includes the applicant’s medical history, occupation, and lifestyle. Real Insurance offers fortnightly or monthly payment options for completing their life insurance applications.
Trauma Insurance
Trauma insurance is also referred to as critical illness cover or recovery insurance. Importantly, this type of insurance is designed to cover medical treatment expenses that private health insurance agencies can’t cover. Some severe health conditions that trauma insurance can pay for are:
- Heart Attacks
- Strokes
- Cancer
- Major Surgeries
Total Or Permanent Disability (TPD) Insurance
TPD insurance pays a lump sum in the event that a health condition permanently prevents a person from working again. There are two common options for TPD and some insurers let people choose which can benefit them more. These are:
- Any Occupation – People can choose this option if they are unable to perform paid work where they are qualified to do so.
- Own Occupation – People can choose this option if they are unable to work for their usual occupation.
Income Protection Insurance
This type of insurance generally provides an income for employees who are unable to work due to health concerns. Like Life insurance, these benefits are paid on a monthly basis. According to moneysmart, income protection insurance can cover up to:
- 90 percent of a person’s pre-tax income in the first six months; and
- 70 percent for a specific time after six months
Additionally, income protection insurance replaces a person’s income based on their yearly income, 12 months prior to their health concerns. People who want to know how much income protection they need should budget their expenses. It’s also essential to consider if a person has:
- Private health insurance that can help with medical expenses;
- Support from family or friends;
- Trauma insurance; or
- TPD insurance
Business Expenses Insurance
This insurance enables business owners to fund the fixed costs of their businesses in the event of serious health conditions. Hence, businesses can resume normal operations while the owner is recovering. Depending on the insurance law in Sydney, business expenses may cover the following:
- Rental fees for office spaces
- Leases and loans on cars, equipment, or heavy machinery
- Insurance and security costs
- Utility bills
- Salaries of non-income producing staff
- Other general business expenditures
Self-Managed Super Fund (SMSF) Insurance
Some insurance agencies may let people establish life and TPD insurance coverage under an SMSF. Click here to read our article about finding a deceased’s superannuation fund. Starting an SMSF requires the help of a solicitor who knows the ins and outs of insurance law in Sydney.
Insurance Law In Sydney: The Importance Of Disclosure Of Information
Applying for insurance will require information from the applicant’s end. An insurer may request the following when applying for insurance:
- Age
- Occupation
- Income (salary, wage, commissions)
- Medical history
- Lifestyle (for instance, if the applicant is a smoker)
- High-risk sports or hobbies (Cliff-diving, mountain climbing, etc)
In return, insurance agencies should let applicants know if they can insure them and how much their premiums will be. Premiums are the amount an individual pays for their monthly health insurance. Furthermore, they provide the applicant with the terms and conditions of their policy.
Truly, there are insurance brokers that specialise in insurance and risk management. However, an applicant can never be too sure if there are legal matters that may arise.
Insurance Law Sydney: Case Study Example
The case of Davis vs Westpac Life Insurances Services Ltd (2007) demonstrates the importance of disclosing medical conditions. Davis was diagnosed with sleep apnoea thus, preventing him from working. This resulted in Davis applying for Income Protection Insurance with Westpac.
However, Davis did not disclose the consultations before the policy’s establishment. As stated, income protection insurance is based on the length of the recovery period. Treating Davis’ condition will also depend on how to draft the policy.
Had Westpac known of Davis’ sleep apnoea, they would have postponed writing the policy until they had the results. If there was no successful treatment for Davis’ severe health condition, the insurer would not have entered into the contract. Finally, Davis’ appeal for life insurance was dismissed with costs.
Seeking Legal Advice With JB Solicitors
Thus, it’s important to seek a solicitor who can review contracts and understand policies about different insurances. Davis’ case resulted in him not being able to acquire life insurance because of the non-disclosure of his health conditions.
Our lawyers at JB Solicitors can help you navigate insurance policies and make sure that both parties follow the terms and conditions. Should matters arise, we can represent clients in court and fight for their rights in getting the proper insurance.
Contact JB Solicitors today to know more about the insurance law in Sydney.
