KOM~QOM – Income Protection For Cyclists

THE FACTS

  1. Many Superannuation and Personal insurance companies think events involving cycling are high-risk (racing, training and even commuting) and apply unfair conditions or exclusions to cycling-related claims;
  2. Major sporting federations provide group personal insurance policies which have to limit the amounts they can pay, which can be less than what many people actually need;
  3. Unless your Super Fund or Personal Insurance company has specifically underwritten your cycling racing, training and commuting, you may not have the cover you think you do.

Understand what you have.

KOM Financial Advice was formed to address the unique Income Protection (IP) and Total & Permanent Disability (TPD) issues cyclists and triathletes may face.

We can help by:

  • recommending an insurer that will provide cover for your cycling or triathlon racing, training and commuting AND cover you for any injury, illness, disease or accident that prevents you from working. It’s true, comprehensive cover;
  • working with you to you determine the cover you actually need, or just implement the level you want; and
  • help you decide if it’s better to pay for premiums inside-Superannuation, outside-Superannuation with your cash-flow or maybe a mixture of both.

We will ensure that your activities are underwritten by the insurer, and therefore approved, and help you get the right amount of cover. We will give you certainty.

Income Protection

Our recommendations aim to pay income protection up to 75% of one’s actual wage and can continue to pay until age 70 years if you like. It can also add extra on top for the ongoing Superannuation contributions you’d miss if you weren’t working.

Cyclist / Triathlete Default ‘AC’ IP Cover Default ‘TA’ IP Cover Potential ‘KOM’ IP Cover
What if your income is $80,000pa ($1,539pw) $500pw for 1 year only $700pw for 1 year only $1,154pw to Age 70
What if your income is $180,000pa ($3,462pw) $500pw for 1 year only $700pw for 1 year only $2,596pw to Age 70
*Based on comparing AusCycling and Triathlon Australia’s maximum payable amount under their respective ‘Loss of Income’ benefits.

**Research conducted by King of the Mountain Financial Advice 2016-2020, where participating in an event includes a competitive cycling element.

Our recommended income protection policies can also pay a lump sum upon breaking various bones, such as the collarbone (1.5 times your monthly benefit) or femur (3 times your monthly benefit).

Cyclist / Triathlete Default ‘AC’ IP Cover Default ‘TA’ IP Cover Potential ‘KOM’ IP Cover
Broken collarbone (example income $80K) $0 - Unless 21 days off work first $0 - Unless 14 days off work first $7,500 lump sum No time off work required at all
Broken collarbone (example income $180K) $0 - Unless 21 days off work first $0 - Unless 14 days off work first $11,250 lump sum No time off work required at all
Broken femur (example income $80K) $0 - Unless 21 days off work first $0 - Unless 14 days off work first $15,000 lump sum No time off work required at all
Broken femur (example income $180K) $0 - Unless 21 days off work first $0 - Unless 14 days off work first $33,750 lump sum No time off work required at all

In each instance, the cyclist or triathlete may be eligible for the default income protection benefit after serving their federation’s waiting period.
*This benefit replicates a multiple of one’s monthly income protection benefit however, it does not require the participant to have any time off work at all. Should the participant be unable to work after the multiple of one’s monthly benefit has expired, they may be entitled to claim their normal monthly income protection benefit also.
**Research conducted by King of the Mountain Financial Advice 2016-2020, where participating in an event includes a competitive cycling element.

What about if it’s permanent?

Many sporting federations can only provide up to a maximum payment of $100,000 if you suffer a Total & Permanent Disability (TPD) event, and it needs to relate to the sport. If you need more than this – remember, you’d be totally disabled and forever – or want to be covered for any injury, illness, disease or accident that renders you TPD, rather than those just from your chosen sport, you can apply to be covered up to $3,000,000, and maybe even more if you need it, through KOM Financial Advice.

Cyclist / Triathlete Default ‘AC’ TPD Cover Default ‘TA’ TPD Cover Potential ‘KOM’ TPD Cover
What if your mortgage, carer costs, education costs, rehab / medical, etc totaled $500,000? Maximum $100,000 Maximum $100,000 $500,000
What if your mortgage, carer costs, education costs, rehab / medical, etc totaled $3,000,000 Maximum $100,000 Maximum $100,000 $3,000,000

These tables are not an extensive ‘features and benefits’ list, but it is a valuable starting point only.
*Click here for a Summary of Insurance for AusCycling
**Click here for a Summary of Insurance for Triathlon Australia
***Research conducted by King of the Mountain Financial Advice 2016-2020, where participating in an event includes a competitive cycling element.

 

THE WRAP-UP

So, if you participate in an event that:

  • requires any sort of one-day or annual licence;
  • is timed;
  • covers a specific distance;
  • allocates you a finishing position; or
  • is considered a form of competition (despite you being competitive or not);

and you crash, then you’re at risk of having your Superannuation Insurance or Personal Insurance claim denied because of a little-known ‘competitive cycling’ exclusion that many insurers have – but don’t tell you about. This can include where you have an accident training for an event or commuting too. For many cyclists and triathletes, this isn’t good enough.

We believe that it’s essential to hold your designated sporting federation’s membership (such as AusCycling or Triathlon Australia) because it covers you for Public Liability – in case you injure someone else – and because they have other features too. But for many, the defined weekly income replacement, or the $100,000 TPD benefit, may just not be enough. And that insurance can only relate to accidents on the bike, not other things that can cause long-term financial stress such as heart problems, mental health problems, or cancer etc.

It’s not good enough just to have insurance. You need to know what your insurance does and doesn’t give you and how to change it if it doesn’t suit your needs. You can make choices, but can you understand the fine print?

We’re here to help you get the cover you need.

King of the Mountain Financial Advice and Queen of the Mountain Financial Advice are registered business names, owned wholly by Full Financial Advice Pty Ltd.

Full Financial Advice Pty Ltd ABN 92 606 914 112 [t/a King of the Mountain Financial Advice] is authorised by King Of The Mountain Pty Ltd ABN 72 642 974 061 AFSL No. 524853 to provide financial service advice only.