Superannuation giant, AustralianSuper, has been in the news recently after announcing that it will stop automatically signing up younger members for insurance.

Adopting an "opt in" rather than "opt out" method for members under 25, the aim is to preseve the balances of young people who statistically hold a smaller superannuation balance. 

While I've seen a lot of praise for this system, what hasn't been discussed is the risk and impact of waiting to obtain risk covers later in life. 

Statistics say that the older you are, the more likely you are to have an adverse medical file. While you likely already knew that, what you might not know is how it affects your ability to obtain an insurance policy.

When you apply for underwritten risk covers (which means your application immediately, not when it's time to claim) your lifestyle, medical history and family history is assessed. 

The more "red flags" that your application raises, the more likely you are to be offered: cover with an exclusion, cover with a loading or no cover at all.

Knowing where you stand with an insurer at the start is much better than paying insurance premiums for years, only to find out that the insurer won't cover you when it comes to claim as they deem you had a pre-existing medical condition before you joined.

Be wary of those insurers who promote that they have "no medical tests" and "no medical questions to answer". They are usually cheap for a reason. 

Usually, the longer you wait to apply for risk cover insurances, the more expensive it will be.

To review your current personal insurance and superannuation strategy, contact Edge Financial Services in Toowoomba for a consultation.