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Make yourinsuranceaffordable thistax yearand beyond

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Important Information

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This presentation was prepared by MLC Limited, ABN 90 000 000 402 and AFSL 230694, a member of the National Australia Group of companies.

The information here is current as at 1 April 2013.

MLC is not a registered tax agent. If you wish to rely on this presentation to determine your personal tax obligations, you should consult in a registered tax agent.

The presentation does not take into account your personal objectives, financial situation or needs. Accordingly you should consider how appropriate the information is to you with regard to your personal circumstances. You may wish to obtain an adviser’s assistance to make this assessment. Before buying any financial product, you should read the Product Disclosure Statement for that product.

Make your insurance affordable this tax year and beyond

Can use co-contribution (up to $5002) to help pay for future insurance premiums

Could claim super contributions as tax deduction

Tax concessions

Buy Life and TPD insurance in super

3Make your insurance affordable this tax year and beyond

1 Includes assessable income, reportable fringe benefits and reportable employer super contributions.2 In 2012/2013

Can use tax offset (up to $540) to help pay for future insurance premiums

Could buy insurance in super with pre-tax dollarsEmployee

Employment income < 10% of total income1

Eligible for co-contribution

Low income spouse

How could you benefit?

Buy Life and TPD insurance in super

These tax concessions:

• Make it more affordable1 to insure in super

• May help you to get higher levels of cover you otherwise couldn’t afford

4Make your insurance affordable this tax year and beyond

1 This can also be the case if the sum insured is increased to make a provision for any lump sum tax that may be payable on TPD and death benefits in certain circumstances.

Case Study

Buy Life and TPD insurance in super

• Jack, aged 45, is married to Claire, aged 41

• Claire’s looking after two young children

• Jack earns pre-tax salary of $100,000 pa

• They have a mortgage

• Jack is worried whether Claire would cope financially if anything happened to him

• They speak to an adviser to see if Jack has enough insurance

5Make your insurance affordable this tax year and beyond

Case Study

Buy Life and TPD insurance in super

• Adviser recommends $700,000 in Life & TPD insurance so if something unfortunate happens (ie. death or total & permanent disability), Claire can:

• continue to pay off debts (i.e. mortgage, school fees)

• maintain the family's financial position

• have some financial security

• Premium is $1,2311 in year one

• Adviser also recommends Jack insures in super

6Make your insurance affordable this tax year and beyond

1 Premium is for a 45 year old, non-smoking, male and is based on MLC’s standard premium rates as at 1 April 2013 and includes policy fee.

Case Study

Buy Life and TPD insurance in super

1 Premium is for a 45-year-old, non-smoking, male and is based on MLC Insurance (Super) standard premium rates as at 1 April 2013. Includes policy fee.

2 Includes Medicare levy of 1.5%.

7Make your insurance affordable this tax year and beyond

Premium comparison (in year one)

Insure inside super via salary sacrifice

Insure outside super with after- tax salary

Premium1 $1,231 $1,231

Plus income tax at 38.5%2 N/A $771

Pre-tax salary sacrificed/ received

$1,231 $2,002

Pre-tax saving $771 N/A

Tips and Traps

Buy Life and TPD insurance in super

• If you have a non-working spouse who needs insurance, you could:

• Make personal deductible contributions

• Benefit from up-front tax concessions

• Split some of contributions into spouse’s super account

• Get spouse to buy insurance in their super fund

• Having premiums deducted from investment account without making additional contributions can help you:

• afford insurance if don’t have sufficient cash flow

• free-up cash flow to purchase other non-super insurances (e.g. Critical Illness1)

8Make your insurance affordable this tax year and beyond

1 Critical Illness insurance can generally only be purchased in your own name (outside super).

Tips and Traps

Buy Life and TPD insurance in super

• With Critical Illness insurance, can reduce cost if ‘connect’ cover with Life and TPD in super1 (i.e. take cover as extension)

• If require ‘own occupation’ TPD policy, you may want to:

• buy TPD insurance outside super

• consider TPD Optimiser and utilise the benefits of insuring through super (i.e. utilising super money to fund insurance premiums) for your "Any Occupation" TPD cover, while having the protection of additional "Own Occupation" cover outside super

9Make your insurance affordable this tax year and beyond

1 No additional policy fee payable. Where a Critical Illness claim is paid, the amount of Life and TPD cover held in super will be reduced by the amount of Critical Illness benefit paid.

Other smart ideas Income Protection insurance (outside super)

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51 Pre-pay up to 12 month's premiums by paying annually

Convert existing policy from monthly to annual premiums

Reduce your tax bill

Claim larger deduction this financial year

Pay annual premiums on new policies

Annual premiums often cheaper too

Summary

• Consider buying Life and TPD insurance in super

• Consider connecting Critical Illness cover

• Consider pre-paying 12 month’s Income Protection premiums

• Choose the right premium payment option for you

11Make your insurance affordable this tax year and beyond

Insurance from MLC

MLC is not a registered tax agent. If you wish to rely on this information to determine your personal tax obligations, you should consult with a Registered Tax Agent.

For more information call MLC from anywhere in Australia on 132 652 or contact your adviser.

Postal address: MLC Limited, PO Box 200North Sydney NSW 2059

Registered office: Ground Floor, MLC Building105–153 Miller StreetNorth Sydney NSW 2060

mlc.com.au