1. Insurance for farmers
Presenter: dd month 2016
[Adviser logo]

2. Disclaimer/AFSL details etc This information is current at January 2016 and is subject to change. As this information (including the statements on taxation which are of a general nature only and based on current laws, rulings and interpretation) has been prepared without considering your objectives, financial situation or needs, you should, before acting on this information, consider its appropriateness to your circumstances. OneCare is issued by OnePath Life Limited (ABN , AFSL ) (OnePath Life) and OneCare Super is issued by OnePath Custodians Pty Limited (ABN , AFSL , RSE L ) (OnePath Custodians). You should read the product disclosure statement, available at onepath.com.au, before making a decision about the products.
Note to Advisers - Please ensure that you satisfy your disclosure obligations as an Australian Financial Services Licensee when providing this presentation to retail clients.

3. Life on the land
In 2013, the Agriculture, Forestry and Fishing industry had1:
10 x the national average of work-related fatalities
2 x the national average of serious workers compensation claims
1 Source: Safe Work Australia, 2015
You don’t need me to tell that you life as a farmer comes with a fair degree of risk.
For one, agriculture is one of the highest-risk industries in Australia when it comes to workplace accidents.
Check out these statistics from 2013 relating to the agriculture, forestry and fishing industry:
16.33 work-related fatalities per 100,000 workers – almost 10 times the national average of 1.70.
21.0 serious workers compensation claims per 1,000 workers – almost double the national average of 11.1.
Source:

4. Life on the land
People in rural Australia are significantly more likely to be diagnosed with:
Bowel cancer
Melanoma
Prostate cancer
Survival rates for cancer are also lower in rural communities – due in part to lack of access to quality medical care
Source: National Rural Health Alliance, January 2012
And we’re not only talking about accidents...
People in rural Australia are significantly more likely to be diagnosed with:
Bowel cancer
Melanoma
Prostate cancer
Survival rates for cancer are also lower in rural communities – due in part to lack of access to early diagnosis techniques and quality medical care after diagnosis.

5. Protection for farmers
If you were unable to work...
What would it mean for your income?
What about your family’s lifestyle?
Could you afford to relocate to seek treatment?
How long would your personal savings last?
How long would your farm survive?
Imagine you couldn’t work due to a serious illness of injury:
What would it mean for your household income?
What about your family’s lifestyle?
Could you afford to relocate to seek treatment if you needed to?
How long would your personal savings last?
How long would your farm survive?

6. Did you know…? • According to a 2014 KPMG report1:
Only 27% of disability insurance needs are being met through existing cover
35% of Australians have no form of disability insurance
• According to research on the impact of the sudden disability of a parent2:
Before a parent became disabled, 11% of parents without insurance rated finance as ‘struggling’. After disability, this rocketed to 62%
75% of those without insurance agreed that in hindsight a policy covering disability would have helped
If you look at the underinsurance statistics among young families, it makes scary reading....
27% of disability insurance needs are being met through existing cover
35% of Australians have no form of disability insurance
So if all these families don’t have enough life insurance, who are they likely to turn to for help? 1.
KPMG report for Financial Services Council, 2014
IMPACT OF DEATH OF A PARENT ON SURVIVING PARTNER AND CHILDREN report. Research conducted by Ipsos on behalf of ANZ Wealth April – May 2015

7. Protection for farmers
Life insurance strategies should consider the cost to:
Fund ongoing living costs for your family
Fund ongoing farm expenses
Repay or service debts (personal and business)
Meet child education needs
Meet medical expenses (incl. travel/accomm)
Maintain savings plans
Allow your partner to take time off
A comprehensive life insurance strategy needs to take into account the financial needs of your family, and your farm.
Such a strategy should include protection to:
Fund ongoing living costs for your family
Fund ongoing farm expenses
Repay or service debts (personal and business)
Meet child education needs
Meet medical expenses (which also needs to factor in travel and accommodation costs if you have to relocate for treatment)
Maintain savings plans
Allow your partner to take time off

8. Protecting your true income
There’s more to income protection than reviewing your tax return...
Does your spouse earn an income from the farm, and would it stop if you did?
Are you re-investing profits in your farm?
What are you really worth to your business?
One of the questions you need to ask yourself is this – what is your true income from your farm?
Sure, you can look at your latest tax return and show what you earned last year. But is that figure a true reflection of your earning potential?
For example, does your spouse derive an income from the business? And would that income be there if you weren’t?
Or are you reinvesting profits in your farm, rather than taking the money as income? And would those profits be there if you weren’t?
When you take out life insurance, it needs to reflect what you’re really worth to your business.

9. What about the National Disability Insurance Scheme?
Does it replace the need for life insurance? No… here’s why:
Designed to help the most severely disabled people, not everyone who has a disability.
Doesn’t cover temporary conditions that may occur. Such as disabilities from a car crash or from a serious illness.
It’s main purpose is to give people who are severely and permanently disabled more personalised assistance and a greater connection with their community. Not financial support.
Available in limited regional areas, with roll out not until 2019/2020
Even if you are eligible, it can’t help you eliminate debts, provide an replacement income or cover the out-of-pocket costs of medication and treatment.
The NDIS provides a safety net, but it was not designed to replace life insurance – which continues to play a vital role in paying out debts and replacing income after the onset of disability.

10. OnePath, one of the market leaders for farmers
Extra Care Cover can be attached to any cover type to add up to $1m cover for accidental death
Guaranteed benefits that don’t fluctuate, even if your income does
Packaging discounts of up to 10% when you take out a policy with a spouse, immediate family member or business partner
OnePath is one of the market-leading insurance companies when it comes to farmers.
Extra Care Cover is an affordable top-up option that can be attached to any policy type. You can choose to add an Accidental Death Benefit of up to $1,000,000 if you die as a result or a serious injury or accident.
OnePath offers guaranteed benefits on their Income Protection policies. That means you may be eligible to receive up to $3,000 per month without showing any proof of income at claim time.
OnePath also offers packaging discounts of up to 10% when you take out a policy with a family member or business partner.

11. Types of cover available
Life cover for death and terminal illness
Helps the family eliminate debts and keep living on the farm
Provides an ongoing income for the family
Pays medical bills and funeral costs
Can be used as part of your estate equalisation strategy for your children
Income protection for sickness or injury
Helps families keep up with mortgage repayments and day-to-day living expenses
Premiums are generally tax-deductible
So what types of life insurance are we talking about?
The main types of cover are:
Life cover, which is basic cover for death and terminal illness.
This type of cover helps families eliminate debts and stay in the family home, it provides an ongoing income for a spouse and children, and it helps cover any medical bills and funeral costs.
Estate equalisation is about having strategies in place to ensure the equitable passing of a family business to the next generation. Should you chose to pass on the business to one child and not the other/others, your insurance pay out can help make the value of your estate equal across all the siblings.
Income replacement cover for sickness or injury.
Usually known as ‘income protection’, this type of cover helps families keep up with the mortgage and everyday expenses – like school fees, electricity bills etc
The premiums for income protection are generally tax-deductible

12. Types of cover available
Total and Permanent Disablement (TPD) cover
Helps eliminate debts and cover long-term care costs
Pays for modifications to the family home
Trauma cover for serious illness
Pays out-of-pocket medical costs (including travel and accommodation costs)
Helps your spouse take time off work to provide care
Allows you to make lifestyle changes – like reducing work hours, or taking an extended holiday
TPD covers people who suffer a total and permanent disability.
This helps people who can never work again by helping them pay off their mortgage, and pay for a carer if they need one. If you’re in a wheelchair for example, it can also help pay for modifications to the family home.
Trauma cover covers a number of serious illnesses, like cancer.
Trauma cover helps cover the medical expenses not covered by private health insurance, which can run into the tens of thousands of dollars when you’re talking about diseases like cancer. When you live in a rural community, this benefit can also help pay for travel and accommodation costs if you have to go to the city for treatment.
It can also allow a spouse to take some unpaid leave to provide care, and encourages people to make the lifestyle changes the need to recover properly – like reduce their work hours or take an extended holiday.

13. Types of cover available
2015 OnePath paid over $116 million in Income protection and business expenses insurance
Business expense cover for sickness or injury
Pays a monthly benefit to cover your fixed business expenses – such as tools and equipment hire
Helps keep your farm running in your absence
Premiums are generally tax-deductible
Child cover for sickness or injury
Pays a lump sum if your child suffers a serious illness or accident
Helps pay medical costs, travel and accommodation
Allows time off work to provide care
Business expense cover is similar to income protection in that it pays a monthly benefit for sickness or injury. The difference is it is related to the fixed expenses of the business, not your income.
It pays a monthly benefit to cover costs such as tools and equipment hire, motor vehicle leases and advertising commitments
With your fixed costs taken care of, Business expense cover is designed to keep your business running in your absence
Like income protection, the premiums for business expense cover are generally tax-deductible
Child cover is also available to pay a lump sum if one of your children suffers a serious illness or accident.
This can help cover medical bills, pay travel and accommodation costs, and
Allow you or your spouse to take some time off work to look after your child.

14. Advice about life insurance
It’s important people seek tailored advice that takes into account their income, debt levels, family status etc
A financial adviser can help with strategies to make life insurance more cost-effective, including insurance inside super
Everyone’s different of course, so the best way for farmers – or anyone for that matter – to get a comprehensive life insurance plan is to speak to a financial planner.
We take into account things like your income, your debts levels, and whether or not you have any dependants.
We can also help you get the right mixture of life insurance products, and structure your insurance in a way that’s most cost-effective. For example, you may take out life cover and TPD cover inside super – which helps you take advantage of the tax benefits of the super environment.

15. Thank you
Questions?