Assumptions
Important information for you
This calculator provides an estimate of how much Death, TPD and TTD cover you might need based on the assumptions below and the figures that you have entered into the calculator. It does not allow for other types of insurance cover such as Health or Trauma cover. Consider your personal circumstances to identify if these or any other types of cover may be right for you.
The amount of insurance cover you require may not be known until after the event has occurred. Therefore, the estimates produced by this calculator are not guaranteed to be sufficient.
When working out how much insurance you need, we have made some assumptions about your financial situation. You can change these to suit your personal circumstances.
This calculator provides an estimate of how much Death, TPD and TTD cover you might need based on the assumptions below and the figures that you have entered into the calculator. It does not allow for other types of insurance cover such as Health or Trauma cover. Consider your personal circumstances to identify if these or any other types of cover may be right for you.
The amount of insurance cover you require may not be known until after the event has occurred. Therefore, the estimates produced by this calculator are not guaranteed to be sufficient.
When working out how much insurance you need, we have made some assumptions about your financial situation. You can change these to suit your personal circumstances.
You can change the values of these important assumptions:
| Assumption |
Current value |
Description |
| Death expenses |
|
This is to provide cover for expenses such as a funeral, legal expenses, etc. |
| TPD expenses |
|
This is to provide cover for expenses such as modifications to your house or car, specialised medical equipment, etc. |
| Spouse/TPD future income proportion |
|
The proportion of your income provided to your spouse until the age specified below. This is paid as a lump sum, assuming the wage and interest assumptions below. If you have selected not to provide cover for a dependent spouse or partner, this proportion of your income is provided to you in the event of TPD. |
| Age spouse/TPD income support ends |
|
The age at which the proportion of your income specified above ceases being paid to you or your spouse. The income continues until you would have turned this age. This is paid as a lump sum, assuming the wage and interest assumptions below. |
| Child income proportion |
|
The proportion of your income provided to your children until the age specified below. This is paid as a lump sum, assuming the wage and interest assumptions below. |
| Age child income support ends |
|
The age at which the proportion of your income specified above ceases being paid to your children. The income continues until they turn this age. This is paid as a lump sum, assuming the wage and interest assumptions below. |
| Age gap between children |
|
If you have more than one child, each child is assumed to be this many years older than the previous one. All children are assumed to be under the age at which income support ceases. |
| Salary Inflation |
|
The rate at which your salary is assumed to increase each future year. |
| Interest Rate |
|
The rate of return that you or your family will need to earn on any insurance payout in order to achieve the desired level of income. |
How are your results calculated?
This section describes the basis of the calculations used to determine your Suggested cover and Cover gap.
Death & TPD Cover
The Suggested cover and Cover gap amounts are calculated in a similar manner for Death and TPD cover. The Suggested cover comprises the following components:
- An allowance for Expenses;
- Replacement of all or part of your current income (annually until retirement age where applicable);
- Replacement of your superannuation contributions (annually until super contribution end age where applicable);
- Additional income to support your children (per child annually until the child reaches the support end age where applicable); and
- Any debts you would like to be paid in the event of your death or disablement (as entered on the Assets & Debts page).
The Cover gap is calculated by subtracting the following from the Suggested cover:
- Your Current cover for each cover type (as entered on the Your details page); and
- Any assets that you or your dependants would be willing to sell in the event of your death or disablement (as entered on the Assets & Debts page).
The Cover gap represents the amount (if any) that your Current cover falls short of the required cover to meet your specified financial needs upon death or disability based on the information you have entered. Where your Current cover and assets exceed the Suggested cover, the Cover gap will be $0.
Note that the relevant Suggested cover and Cover gap calculations are adjusted based on the relevant Salary inflation and Interest rate assumptions used to derive the present value of the cover amounts required to provide the specified levels of future income for you or your dependants.
The initial levels of the components making up the Suggested cover are calculated in the following manner.
Death expenses or TPD expenses
The levels of cover for these expenses are initially set to the default values in the assumptions table above.
Replacement of your current income
Replacement of your current income is calculated as the total amount needed to provide the selected annual levels of income for you or your dependants until the retirement age specified. Note this component is not included for Death cover if you do not have a spouse/partner or any children
The default level of income provided is a percentage of your current salary as specified in the assumptions table above. You can adjust the desired level of income using the slider and the retirement age is adjustable in the assumptions table.
Income for children
The additional income to support your children is calculated as the total amount needed to provide the selected annual levels of child income per child until each child reaches the support end age. Note this component is not included if you do not have any children.
By default, the level of income provided is a percentage of your current salary as specified in the assumptions table above. You can adjust the desired level of income using the slider and the age child income support ends is adjustable in the assumptions table.
The age of each child is determined by starting from the age of the youngest child and adding the age gap between children to the age of the previous child until all ages are known. This assumption is then used to determine the number of years the child income is required to provide for each child. Up to 5 children can be included. If you have more than 5 dependent children, you can adjust the amount of income for your children to provide for additional children using the slider. You should also seek financial advice for the right amount of cover for your personal situation.
Superannuation contributions
The replacement of your superannuation contributions is calculated as the total amount needed to provide the selected annual contribution amount until the age super contributions end. Note this component is not included for Death cover if you do not have a spouse/partner.
How are your results calculated?
This section describes the basis of the calculations used to determine your Suggested cover and Cover gap.
Death & TPD Cover
The Suggested cover and Cover gap amounts are calculated in a similar manner for Death and TPD cover. The Suggested cover comprises the following components:
- An allowance for Expenses;
- Replacement of all or part of your current income (annually until retirement age where applicable);
- Replacement of your superannuation contributions (annually until super contribution end age where applicable);
- Additional income to support your children (per child annually until the child reaches the support end age where applicable); and
- Any debts you would like to be paid in the event of your death or disablement (as entered on the Assets & Debts page).
The Cover gap is calculated by subtracting the following from the Suggested cover:
- Your Current cover for each cover type (as entered on the Your details page); and
- Any assets that you or your dependants would be willing to sell in the event of your death or disablement (as entered on the Assets & Debts page).
The Cover gap represents the amount (if any) that your Current cover falls short of the required cover to meet your specified financial needs upon death or disability based on the information you have entered. Where your Current cover and assets exceed the Suggested cover, the Cover gap will be $0.
Note that the relevant Suggested cover and Cover gap calculations are adjusted based on the relevant Salary inflation and Interest rate assumptions used to derive the present value of the cover amounts required to provide the specified levels of future income for you or your dependants.
The initial levels of the components making up the Suggested cover are calculated in the following manner.
Death expenses or TPD expenses
The levels of cover for these expenses are initially set to the default values in the assumptions table above.
Replacement of your current income
Replacement of your current income is calculated as the total amount needed to provide the selected annual levels of income for you or your dependants until the retirement age specified. Note this component is not included for Death cover if you do not have a spouse/partner or any children
The default level of income provided is a percentage of your current salary as specified in the assumptions table above. You can adjust the desired level of income using the slider and the retirement age is adjustable in the assumptions table.
Income for children
The additional income to support your children is calculated as the total amount needed to provide the selected annual levels of child income per child until each child reaches the support end age. Note this component is not included if you do not have any children.
By default, the level of income provided is a percentage of your current salary as specified in the assumptions table above. You can adjust the desired level of income using the slider and the age child income support ends is adjustable in the assumptions table.
The age of each child is determined by starting from the age of the youngest child and adding the age gap between children to the age of the previous child until all ages are known. This assumption is then used to determine the number of years the child income is required to provide for each child. Up to 5 children can be included. If you have more than 5 dependent children, you can adjust the amount of income for your children to provide for additional children using the slider. You should also seek financial advice for the right amount of cover for your personal situation.
Superannuation contributions
The replacement of your superannuation contributions is calculated as the total amount needed to provide the selected annual contribution amount until the age super contributions end. Note this component is not included for Death cover if you do not have a spouse/partner.
Calculation Methodology
The following assumptions have been made when making these calculations. You can change the values indicated with an asterisk {*} (the default values are shown below).
Death & TPD Cover
The "calculated" levels of Death and TPD covers provide for:
- Debt repayment;
- Expenses on Death or TPD;
- Income for children (where applicable); and
- Income for spouse/partner (where applicable)
The total calculated cover is the sum of the above components. As these types of cover provide a lump sum payment, a lump sum equal to the present value of future income for spouse and children is included in the "calculated" cover where applicable, as described below.
The calculated levels of these components are determined for you as set out below.
Debt repayment
The levels of debt repayment are initially set to the amount by which your current debts exceed your assets. You can override these values using sliders on the Calculated Cover page.
Expenses on Death or TPD
The levels of cover for expenses on Death or TPD are initially set to {*} for Death and {*} for TPD. You can override these values using the sliders on the Calculated Cover page.
Income for Spouse/Future income on TPD
Cover for future income for your spouse or partner (or for you on TPD if you have selected not to provide cover for a spouse) is calculated as the amount needed to fund an annual income equal to the amount selected using the sliders on the Calculated Cover page (and increasing by {*} per year), up to your th{*} birthday.
The initial level of income is calculated as {*} of your income (as entered by you on the Personal Details page).
It is assumed that the insurance amount will be invested and will earn an investment return of {*} p.a. after tax in future years. Future income is assumed to grow at p.a.{*}
Income for Children
Cover for future income for each dependent child is calculated as the amount needed to fund an annual income equal to the amount selected using the sliders on the Calculated Cover page (and increasing by {*} per year), up to age {*}.
The initial level of income is calculated as {*} of your income (as entered by you on the Personal Details page) for each child. No additional allowance is made for more than 5 children.
The age of each child is assumed to be {*} years older than the next youngest, but capped at age 21.
It is assumed that the insurance amount will be invested and will earn an investment return of {*} p.a. after tax in future years. Future income is assumed to grow at p.a.{*}
Minimum level of cover
Maximum level of cover
This tool is intended to provide broad guidance on the level of insurance cover required to meet debt obligations and replace a portion of income in the event of death, TPD or temporary disablement. The calculated cover is not a recommendation and is not intended to be an exact figure. It does not take all of your needs into account and does not constitute financial advice.
Death and TPD cover has been rounded to increments of $10,000.
Separate advice should be sought regarding the need for any other insurance including Trauma and Private Health Insurance.
All figures are gross of tax. No allowance is made for your particular tax circumstances or for the taxation of insurance benefits, either inside or outside superannuation. Generally, Death and TPD insurance benefits will be taxed at a lower rate than the income they are replacing. Please seek separate tax advice in relation to insurance benefits.
No allowance has been made for any social security benefits to which you may be or become entitled.
No assessment is carried out as to the availability of cover. Cover may not be available to some customers either for health reasons or due to their occupation.
You should consider obtaining advice from a licensed financial adviser before making any decision.
Your Needs
You should reassess your insurance needs regularly as your circumstances may change. Also, while the assumptions underlying this calculator are considered reasonable at the present time, these assumptions may be reviewed in future.
Disclaimer
This tool is intended to provide broad guidance on the level of insurance cover required to meet debt obligations and replace a portion of income in the event of death, TPD (total and permanent disablement) or temporary disablement. The calculated cover is not a recommendation and is not intended to be an exact figure. It does not take all of your needs into account and does not constitute financial advice.
Death and TPD cover has been rounded to increments of $10,000.
This insurance needs calculator will only recommend a maximum insurance amount of $2,000,000 for Death and TPD, which is the maximum allowable under the Maritime Super policy.
Separate advice should be sought regarding the need for any other insurance including Trauma and Private Health Insurance.
All figures are gross of tax. No allowance is made for your particular tax circumstances or for the taxation of insurance benefits, either inside or outside superannuation. Generally, Death and TPD insurance benefits will be taxed at a lower rate than the income they are replacing. Please seek separate tax advice in relation to insurance benefits.
No allowance has been made for any social security benefits to which you may be or become entitled.
No assessment is carried out as to the availability of cover. Cover may not be available to some customers either for health reasons or due to their occupation.
You should consider obtaining advice from a licensed financial adviser before making any decision.
Your Needs
You should reassess your insurance needs regularly as your circumstances may change. Also, while the assumptions underlying this calculator are considered reasonable at the present time, these assumptions may be reviewed in future.