Commence a Regular Gearing Strategy...................................................................................23

 [Increase] You may need to undergo further underwriting to increase your insurance cover.  [Increase] Your total premium will increase from $XXX to $XXX p.a. as a result of increasing your cover.  [Increase – Super ownership] The increased premiums will further erode your retirement savings. We estimate that at retirement, your superannuation balance will be $XXX less than if you did not pay your premiums through your super account.  [Reduce] If you decide to increase your insurance cover again in the future, the new cover may be difficult to obtain and/or may be more expensive. This is because your age and health are two important factors that determine eligibility for cover and the premiums you pay.  [Specified levels of cover] You have specified the level of cover for your Life / TPD / Trauma / IP insurance and as such, we cannot confirm if this level of cover is appropriate for your needs. You may be underinsured as a result and not have adequate cover in place to meet your financial commitments in the event of a claim.  We have estimated the impact of certain health events on your financial position. The actual impact may be more than we have calculated and therefore you may be underinsured. Significant changes to your circumstances may also impact the appropriateness of the level of cover recommended. Please contact our office to arrange a review in the event of any significant changes to your lifestyle and/or needs.  [Level] Level premiums may increase over time; they are not fixed rates.  [Stepped] Stepped premiums will increase each year in line with your age.  [Cash flow] The recommended insurance premiums will reduce your personal cash flow available for other expenditure.  [Super] We have recommended you pay $XXX p.a. through your XXX Superannuation Fund. This will reduce your retirement savings. We estimate that your balance will be $XXX lower at age 65 than if you do not pay insurance via your super account. Please refer to our financial projections at the end of the SoA for further explanation.  [Super] Holding life and TPD insurance within superannuation may result in tax being paid on benefits. This will result in the net payment amount being less than the calculated need. We recommend that you seek specialist tax advice to confirm the possible outcomes. [Gross up] We have grossed up your TPD benefit to allow for the tax payable on claim of TPD.

42. Establish your Risk Protection Plan

We recommend that you establish a risk protection plan to support your wealth creation goals. We recommend you apply for personal insurance as follows:  $XXX Life insurance on a stepped / level premium payable monthly / annually.  $XXX Total and Permanent Disablement (TPD) ‘any’ / ’own’ occupation insurance on a stepped / level premium payable monthly / annually.  $XXX Trauma insurance on a stepped / level premium payable monthly / annually.  $XXX per month Income Protection insurance on a stepped / level premium. We recommend a <Waiting Period> waiting period with a benefit period of <Benefit Period>. The premiums for this risk protection insurance will be sourced from cash flow / from your XXX cash account / from your XXX Super Fund.

Benefits:

 You will have funds available in the event of death / TPD / illness or injury to pay down your debts of $XX/ provide ongoing income of $YY to ZZZZ/ pay your children’s education fees / provide funds for your funeral costs / Other.  [Super] Structuring your insurance partly through superannuation will reduce the impact on your personal cash flow.  [Super Rollover] Paying your insurance via annual rollover will give you a 15% discount on your premiums.  [Monthly] Paying premiums monthly will help you to smooth the impact on your cash flow.  [Yearly] Paying premiums annually will reduce the cost of your insurance.  Your family will have financial support in place should anything happen to you and your ability to earn income.  [Income Protection tax deduction] Paying your income protection premiums from cash flow will allow you to claim a tax deduction in your tax return each year.

Points to Consider:

 We have recommended new insurance that will be underwritten by the insurer to assess your application. They may offer revised terms including higher premiums or health exclusions, depending on the outcome of their assessment.  Do not cancel any existing insurance cover prior to the recommended insurance being accepted and put into force.