Contents 1 Protect yourself and

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1 Insurance handbook for Sole Traders Auth. No November 2015 The information in this document forms part of the Product Disclosure Statement for Cbus Sole Trader Super of 1 November Contents 1 Protect yourself and your family with Cbus insurance 3 2 Insurance cover summary 4 3 Default cover 5 4 About Death and TPD cover 7 5 Insurance scales for Death and TPD cover 8 6 Changing or increasing your Death and TPD cover 12 7 When does your Death and TPD cover stop? 15 8 Restarting your Death and TPD cover after it s been cancelled or expired 16 9 About IP cover Changing or increasing your IP cover When does IP cover stop? Restarting your IP cover after it s been cancelled or expired What happens if you start to receive Employer Contributions in Cbus Sole Trader Super? Making an insurance claim Insurance definitions Manage your account online Need help to sort out your insurance? Other questions about your super? 39

2 Auth. No This Product Disclosure Statement (PDS) is a summary of significant information about Cbus and contains a number of references to important information. Refers to incorporated by reference materials Refers to important information for you to note You should consider this information before making a decision. If you want a printed copy of the PDS or other information referenced, please call or us. Cbus Trustee: United Super Pty Ltd ABN AFSL Cbus ABN The contents of this PDS is general information only and does not take into account your financial situation or needs. You should obtain financial advice tailored to your own personal circumstances. Please note the information in this PDS is current as at 1 November 2015 and is subject to change between the time you read it and when you join Cbus. For updated information visit our website or call us. with Cbus 3 Together we ll look after your future Our members work in some of the toughest conditions of any industry. That s why we believe insurance is essential to make sure your income and your family s welfare are protected 24 hours a day, 7 days a week. This handbook tells you all about insurance through Cbus Sole Trader Super. When you join Cbus Sole Trader Super, you may receive cover automatically for Death, Total and Permanent Disablement (TPD) and Income Protection (IP). If you need more information or help, contact us on or [email protected] Important information The information in this Insurance handbook is current at the time of printing but may be subject to change due to amendments to legislation, fund rules or other causes. You can access the most up-to-date information at or call the Service Centre on A copy of this information will be provided to you on request free of charge. You will be advised of any change to the information that is materially adverse through the Fund s member magazine Cbus News or via a new Insurance handbook or Product Disclosure Statement (PDS). This Insurance handbook sets out the main features and benefits of insurance in Cbus Sole Trader. Please read it thoroughly. This Insurance handbook has been prepared and issued on 1 November 2015 by Cbus Trustee: United Super Pty Ltd. ABN AFSL Cbus ABN This document replaces the previous insurance information provided in the Insurance handbook for Sole Traders dated 8 September Insurance is issued under group policies taken out by the Trustee with the Insurer. The Fund s Insurer is TAL Life Limited ABN , AFSL ( Insurer, TAL ). Please note that the terms and conditions of the Trustee s policies with TAL will prevail over any information in this document related to TAL s provision of insured benefits. General advice warning This information is about Cbus. It doesn t take into account your specific needs, so you should look at your own financial position, objectives and requirements before making any financial decisions. Read the Cbus Sole Trader Super Product Disclosure Statement to decide whether Cbus is right for you. To obtain a copy, please call Privacy Your information is private. Cbus takes the utmost care with your personal information. Cbus collects personal information to manage memberships, claims and benefit payments. You can access a copy of our Privacy policy and Personal information collection statements at or by calling our Service Centre on The information in this document forms part of the Product Disclosure Statement for Cbus Sole Trader Super of 1 November Join Cbus Sole Trader Super Product Disclosure Statement: 1 November [email protected] Contents 1 About Cbus 2 2 How super works 2 3 Benefits of investing 4 Risks of super 3 5 How we invest your money 3 6 Fees and costs 4 7 How super is taxed 5 8 Insurance in your super 6 9 How to open an account 8 10 Other information /15

3 1 Protect yourself and your family with Cbus insurance Insurance is one of the best ways you can protect your future. It s about looking after yourself and your family if illness, injury or an accident stops you from working. That s why Cbus believes insurance is essential for all our members. Affordable insurance, around the clock. You re covered 24 hours a day, 7 days a week Easy to set up Affordable Costs come out of your super, not your bank account You can choose the type and amount of cover you need Cover designed for Cbus members You can check your cover online anywhere, anytime Whether you re at work or at home, you ll be protected If you re eligible, you get cover when you join Cbus and you don t have to show proof of your health to get it Because we buy our insurance as a group, costs are generally lower than insurance you buy as an individual Your super covers the cost of your insurance so you don t need to find room in your budget Because everyone s needs are different, you can tailor your cover to suit your needs We have three occupation categories for Death and TPD cover, and three for Income Protection cover designed to suit the risks of different types of work Register for our online Member SuperSite to see your insurance cover whenever you need to. To register: Call us on for your password You can then log in to Insurance handbook for Sole Traders 3

4 2 Insurance cover summary What types of cover can I get through Cbus Sole Trader Super? You can have three types of cover through Cbus Sole Trader Super: Death cover Total and Permanent Disablement (TPD) cover Income Protection (IP) cover Insurance FAQs Death cover provides a lump sum payment (on top of your account balance) if you die. You ll also be covered in the event you re diagnosed with a Terminal Illness that s likely to lead to your death within 24 months from the date of your diagnosis. TPD cover provides a lump sum payment (on top of your account balance) if you re unlikely to ever work again due to Illness or Injury and you meet the TPD definition under the Cbus Insurance Policy. TPD cover doesn t cover you if you re temporarily or partially disabled. This means it won t cover you if you have to stop work due to an Injury or Illness, but can later return to work in your job or any other job for which you re reasonably suited based on your education, training and experience. IP cover provides a monthly income if you can t work because you have had an as long as you meet the disability definitions under the Cbus Insurance Policy. You may also apply for your IP cover to protect you in case you can t work because of Illness by completing an Application to vary income protection cover. How do I get insurance cover? Default cover (see page 5) The first time you join Cbus Sole Trader Super, you may be eligible to receive one unit of Death and TPD cover and six units of only IP insurance cover without having to provide any health evidence, provided that you meet the eligibility conditions. This is called Default cover. You can apply to change your Default cover at any time after you join. How much cover can I have? The amount and type of cover you can have depends on your age, the number of insurance units you choose and your occupation category. When does my cover start? Your Default cover will start automatically subject to eligibility, on the later of: the date we accept your application to join Cbus Sole Trader Super; and your account balance being at least $250 within 31 days of us receiving your application to join. Who pays for my cover? The cost of cover is paid for out of your super account balance each month, as long as your cover hasn t stopped see pages 15 and 24 on when Death, TPD and IP cover stop. How is the cost of cover calculated? The total cost depends on how many units of cover you choose, the type of cover, your age and your occupation category. How much cover do I need? The Default cover you receive when you join Cbus may not be enough to cover your needs. If it isn t, you can apply to change it (see Changing or increasing your cover on pages 12 and 18). Before you choose how much cover you want, think carefully about what financial support you or your family would need if you died before you retire, or if you could never work again. Think about: income how much you earn today (and what could you be earning in the future)? dependants do you have a spouse, de-facto spouse, children or other financial dependants? debts do you have a mortgage, loan or other debts? assets do you own any property or shares? We can help you work out how much, or what type of cover can meet your needs. Call us on to speak to the Cbus Advice Team. Insurance terms: how to find out what they mean When you see an insurance term written in bold italics like this: or Illness you can find its meaning in the insurance definitions section on pages Need help to choose your cover? Cbus can help you work out how much, or what type, of cover can meet your needs. You can: Try our handy insurance calculator at for a snapshot of what you might need. Call us on and speak to the Cbus Advice Team. If you would like to arrange a meeting with a financial planner for more comprehensive personal financial advice, the Cbus Advice Team can refer you to an accredited Certified Financial Planner (CFP ) who meets strict professional qualification and service criteria set by Cbus and the Financial Planning Association (FPA) of Australia. The financial planner can offer you advice on a feefor-service basis. Your first meeting is at no cost and any fees for advice will be agreed with you in advance. 4 Insurance handbook for Sole Traders

5 3 Default cover What is Default cover? Default cover is the type and level of cover you receive when you first become a Cbus Sole Trader Super member (as long as you re eligible). You ll receive Default cover under the Manual occupation category. You may be eligible to change your occupation category from Manual to the Non-Manual, Professional (Death & TPD only) or Skilled Trades (IP only) occupation categories when you complete your Join Cbus Sole Trader Super form. Refer to Applying to change your cover when you join on page 12. The number and cost of Default Death, TPD and IP cover units you receive will depend on your age and the type of cover you are eligible for, as shown in the table below. Default insurance cover as at 1 November 2015 Age Default units of cover Cost of Default insurance cover years 1 unit of Manual Death and TPD 6 units of IP: - only - 2 year benefit period - 30 day waiting period years 1 unit of Manual Death only cover Death and TPD: $3.58 per week IP: the cost of IP will vary depending on your age. Refer to the section on How much will Default IP cover cost below. Death only: $1.33 per week Default cover is subject to eligibility conditions, please refer to the section Am I eligible for Default cover? on the right for more details. How much is your Default Death and TPD cover worth? The table below shows the amount your Default Death and TPD cover may be worth based on your age. After age 50, the value of a unit of cover reduces. Manual Default cover Age Death TPD Age Death TPD $52,000 $26, $23,000 $11, $48,000 $24, $21,000 $10, $44,000 $22, $19,000 $9, $39,500 $19, $17,000 $8, $35,000 $17, $15,000 $7, $33,000 $16, $12,500 $0 56 $31,000 $15, $10,000 $0 57 $29,000 $14, $8,000 $0 58 $27,000 $13, $6,000 $0 59 $25,000 $12, $6,000 $0 How much is your Default IP cover worth? Six units of IP insurance cover can pay you up to $600 per week (under the eligibility conditions and limitations explained on pages 17-23). only IP provides cover if you claim due to an which happened after your cover started. The waiting period is the amount of time you have to be off work due to your before you re eligible to receive monthly income payments. The waiting period is explained on page 21. The benefit period is the maximum amount of time you can receive monthly income payments while you are Totally Disabled or Partially Disabled. The benefit period is explained on page 21. How much will Default IP cover cost? The cost of Default IP cover depends on your age. The table below shows the weekly cost of Default IP cover (six units) based on your age. Weekly cost of Default IP cover Age range Manual $4.08 $3.96 $3.72 $4.32 $5.16 Age range Manual $6.48 $7.98 $9.54 $10.92 $11.04 Am I eligible for Default cover? You must meet some conditions to be eligible for Default cover through Cbus Sole Trader Super. You ll receive cover if: we receive your initial contribution of at least $250, within 31 days from the date we receive your accurately completed Join Cbus Sole Trader Super form, and we accept you as a member of Cbus Sole Trader Super, and you meet all the eligibility criteria for cover set out in the table on page 6. Insurance handbook for Sole Traders 5

6 3 Default insurance cover (continued) You ll receive Default Death and TPD cover as long as: You re age 15 or over and under age 65 for TPD cover under age 70 for Death cover; and We receive your accurately completed Join Cbus Sole Trader Super form within 31 days of you signing and dating it. You have a minimum account balance of $250 within 31 days of us accepting your accurately completed Join Cbus Sole Trader Super form. You re not currently applying for, not entitled to, or haven t been paid a TPD or terminal illness benefit from any super fund or life insurance policy; and You ve not been diagnosed with an illness that s likely to lead to your death within 24 months from the date of your diagnosis; and You re in Active Employment on the date your cover starts. If you re under age 15 * or age 70 or over, you won t be eligible for any insurance cover. If you re aged 65 to 69, you ll only be eligible for Default Death cover. You ll need to apply for TPD cover. If you don t meet either of these conditions, you won t be eligible for Default cover. If you don't meet either of these conditions, you won't be eligible for any insurance cover. If you don t meet this condition, you ll only receive Death and New Events Cover for TPD until you re in Active Employment, at which time you will receive TPD cover for all events. Default only IP cover will be provided as long as: You re age 15 or over and under age 65; and You re an Australian Resident; and We receive your accurately completed Join Cbus Sole Trader Super form within 31 days of you signing and dating it; and You have a minimum account balance of $250 within 31 days of us accepting your accurately completed Join Cbus Sole Trader Super form; and You re working 15 or more hours a week at the time of completing your application; and You re not working in an Excluded Occupation (read page 34 for a list of Excluded Occupations); and You re not currently applying for, not entitled to, or haven t been paid a TPD or terminal illness benefit from any super fund or life insurance policy; and You ve not been diagnosed with an illness that s likely to lead to your death within 24 months from the date of your diagnosis. If any of these conditions aren t met, you won t be eligible for IP under Cbus Sole Trader Super. * You re not eligible to become a member if you re under age 15. Important Note: Your eligibility for cover will be checked when you claim and your benefits payments may change or be denied if you didn t give correct details when you joined Cbus Sole Trader Super. When will my cover start? Subject to your Join Cbus Sole Trader Super form being accepted by Cbus, your Default cover will start from the later of: the date we accept your signed Join Cbus Sole Trader Super form, and the date on which you have a minimum account balance of $250, provided that this is within 31 days of us receiving your accurately completed Join Cbus Sole Trader Super form. If you don t meet this condition, you won t be eligible for Default cover. Can I decrease or cancel my Default cover? Decreasing IP when you join Cbus believes members should have access to insurance cover to protect themselves and their family. However, you can decrease your IP cover when completing your Join Cbus Sole Trader Super form if the Default six units is too much cover for your level of income. All you need to do is indicate the number of units you need between one and six. We suggest you read How much cover can IP insurance give you? on page 17 to work out how much cover you need before you decrease your Default IP cover. Decreasing or cancelling all types of cover You can also decrease or cancel your Death, TPD and/or IP cover at any time by completing an Application to decrease or cancel insurance cover form at (or call for a copy). Note: The only way you can cancel your insurance cover with us is by completing this form. Until we receive your request to decrease or cancel your cover, any Default cover you have will stay in place (as long as your cover doesn t stop for another reason see pages 15 and 24). You should know that if you change your mind and later want cover, you ll need to complete an Application to increase insurance cover (for Death and TPD) or an Application to vary income protection cover (for IP cover) and provide information relevant to your application. This may include having medical tests to help the Insurer assess your application. Any increase in your cover will be subject to acceptance of your application by the Insurer. You ll receive the cover that is available at the time your application is accepted. We strongly suggest you speak to Cbus on before you decide to decrease or cancel your cover. Not sure if you have Default cover? You can check how much cover you have on your most recent statement, online at or call us on Insurance handbook for Sole Traders

7 4 About Death and TPD cover How much cover can Death and TPD insurance give you? Before you work out how many units of cover you want, you need to know how much money each unit is worth. This depends on: your age, and which occupation category you get cover under (see below). The tables on the following pages will help you work out how much Death and TPD insurance is right for you and your family. Occupation categories for Death and TPD cover As part of the Join Cbus Sole Trader Super form, we ask you some questions about your job. Your answers determine which occupation category you can be covered under. Each category has its own insurance scale which tells you how much each unit of cover is worth. To see how much each unit of cover is worth under the different occupation categories, check the insurance scales on pages It s important to answer questions about your job on the Join Cbus Sole Trader Super form so we can maximise your level of cover. You could be eligible for more cover per unit, for the same cost. You can apply to change your occupation category at any time see page 15 for details. Eligibility for occupation category Example occupations Manual Non-Manual Professional Perform any manual (physical) work, or Spend more than 20% of your working time outside of an office environment Note: If you don t answer any occupation questions when you join, you ll be covered under this category. Carpenter, Plasterer, Bricklayer, Plumber Perform work of a clerical, administrative, managerial or professional nature, and Perform a minimum of 80% of your work in an office environment, and Don t perform any manual (physical) work. Bookkeeper, Tax Adviser, Insurance Broker Perform work of an entirely sedentary professional nature, and Perform a minimum of 80% of your work in an office environment, and Don t perform any manual (physical) work, and Have an Annual Taxable Income of more than $100,000 (which can be applied pro rata for permanent part-time workers), and either of the following applies: - you hold a university qualification (Bachelor degree or above), or - you re a Senior Manager or Executive within the organisation in which you re employed (see definitions on page 35). Accountant, Architect, Lawyer Cover Period Death Age Age Age Cover Period TPD Age 15 69* Age 15 69* Age 15 69* Death and TPD cost per unit per week Death only cost per unit per week TPD only cost per unit per week $3.58 $3.58 $3.58 $1.33 $1.55 $1.55 $2.25 N/A N/A * You need to apply for TPD cover from ages 65 to 69, otherwise cover stops at age 65. Cover can be extended if you apply within the 12 months before turning 65, subject to acceptance by the Insurer. See Extra TPD units for Manual members on page 13 for more information. Insurance handbook for Sole Traders 7

8 5 Insurance scales for Death and TPD cover Insurance scales How to read the scales Look up your age on the table that matches your occupation category (from page 7). The more units of cover you have, the higher the amount you could receive if you make a claim. However, that amount will reduce as you get older. The weekly cost also increases with the number of units you choose, and this will come out of your super account. 8 Insurance handbook for Sole Traders

9 Manual scale This is your scale if you: perform any manual (physical) work, or spend more than 20% of your working time outside an office environment. 1 unit 2 units 3 units 4 units Case study Age $3.58 a week $7.16 a week $10.74 a week $14.32 a week Death TPD Death TPD Death TPD Death TPD $52,000 $26,000 $104,000 $52,000 $156,000 $78,000 $208,000 $104, $48,000 $24,000 $96,000 $48,000 $144,000 $72,000 $192,000 $96, $44,000 $22,000 $88,000 $44,000 $132,000 $66,000 $176,000 $88, $39,500 $19,750 $79,000 $39,500 $118,500 $59,250 $158,000 $79, $35,000 $17,500 $70,000 $35,000 $105,000 $52,500 $140,000 $70, $33,000 $16,500 $66,000 $33,000 $99,000 $49,500 $132,000 $66, $31,000 $15,500 $62,000 $31,000 $93,000 $46,500 $124,000 $62, $29,000 $14,500 $58,000 $29,000 $87,000 $43,500 $116,000 $58, $27,000 $13,500 $54,000 $27,000 $81,000 $40,500 $108,000 $54, $25,000 $12,500 $50,000 $25,000 $75,000 $37,500 $100,000 $50, $23,000 $11,500 $46,000 $23,000 $69,000 $34,500 $92,000 $46, $21,000 $10,500 $42,000 $21,000 $63,000 $31,500 $84,000 $42, $19,000 $9,500 $38,000 $19,000 $57,000 $28,500 $76,000 $38, $17,000 $8,500 $34,000 $17,000 $51,000 $25,500 $68,000 $34, $15,000 $7,500 $30,000 $15,000 $45,000 $22,500 $60,000 $30, $12,500 $6,250 $25,000 $12,500 $37,500 $18,750 $50,000 $25, $10,000 $5,000 $20,000 $10,000 $30,000 $15,000 $40,000 $20, $8,000 $4,000 $16,000 $8,000 $24,000 $12,000 $32,000 $16, $6,000 $3,000 $12,000 $6,000 $18,000 $9,000 $24,000 $12,000 Note: You need to apply for TPD cover from ages 65 to 69, otherwise cover stops at age 65. Cover can be extended if you apply within the 12 months before turning 65, subject to acceptance by the Insurer. Adrian is a 32 year old Plasterer who wants to apply for cover above the Default level (1 unit of Death and TPD) when joining. He decides to apply for 1 additional unit of TPD to match his current dollar amount of Death cover. Adrian completes an Application to increase insurance cover and supplies information about his health to the Insurer. Adrian s insurance cover Amount of Death cover 1 x $52,000 = $52,000 Amount of TPD cover 2 x $26,000 = $52,000 Total cost per week: $ unit of Death and TPD cover: 1 x $3.58 = $ additional unit of TPD cover: 1 x $2.25 = $2.25 Insurance handbook for Sole Traders 9

10 5 Insurance scales for Death and TPD cover (continued) Non-Manual scale This is your scale if you: perform work of a clerical, administrative, managerial, or professional nature, and perform a minimum of 80% of your work in an office environment, and don t perform any manual (physical) work. 1 unit 2 units 3 units 4 units Age $3.58 a week $7.16 a week $10.74 a week $14.32 a week Death TPD Death TPD Death TPD Death TPD $122,500 $122,500 $245,000 $245,000 $367,500 $367,500 $490,000 $490, $119,400 $119,400 $238,800 $238,800 $358,200 $358,200 $477,600 $477, $116,100 $116,100 $232,200 $232,200 $348,300 $348,300 $464,400 $464, $112,900 $112,900 $225,800 $225,800 $338,700 $338,700 $451,600 $451, $109,400 $109,400 $218,800 $218,800 $328,200 $328,200 $437,600 $437, $105,700 $105,700 $211,400 $211,400 $317,100 $317,100 $422,800 $422, $102,000 $102,000 $204,000 $204,000 $306,000 $306,000 $408,000 $408, $96,700 $96,700 $193,400 $193,400 $290,100 $290,100 $386,800 $386, $91,500 $91,500 $183,000 $183,000 $274,500 $274,500 $366,000 $366, $86,200 $86,200 $172,400 $172,400 $258,600 $258,600 $344,800 $344, $81,000 $81,000 $162,000 $162,000 $243,000 $243,000 $324,000 $324, $75,500 $75,500 $151,000 $151,000 $226,500 $226,500 $302,000 $302, $72,400 $72,400 $144,800 $144,800 $217,200 $217,200 $289,600 $289, $69,300 $69,300 $138,600 $138,600 $207,900 $207,900 $277,200 $277, $66,200 $66,200 $132,400 $132,400 $198,600 $198,600 $264,800 $264, $63,200 $63,200 $126,400 $126,400 $189,600 $189,600 $252,800 $252, $61,500 $61,500 $123,000 $123,000 $184,500 $184,500 $246,000 $246, $61,000 $61,000 $122,000 $122,000 $183,000 $183,000 $244,000 $244, $60,400 $60,400 $120,800 $120,800 $181,200 $181,200 $241,600 $241, $60,200 $60,200 $120,400 $120,400 $180,600 $180,600 $240,800 $240, $60,100 $60,100 $120,200 $120,200 $180,300 $180,300 $240,400 $240, $59,800 $47,300 $119,600 $94,600 $179,400 $141,900 $239,200 $189, $55,300 $43,500 $110,600 $87,000 $165,900 $130,500 $221,200 $174, $50,800 $39,700 $101,600 $79,400 $152,400 $119,100 $203,200 $158, $45,700 $33,900 $91,400 $67,800 $137,100 $101,700 $182,800 $135, $42,200 $26,500 $84,400 $53,000 $126,600 $79,500 $168,800 $106, $39,600 $26,500 $79,200 $53,000 $118,800 $79,500 $158,400 $106, $37,000 $23,800 $74,000 $47,600 $111,000 $71,400 $148,000 $95, $34,400 $21,100 $68,800 $42,200 $103,200 $63,300 $137,600 $84, $31,600 $18,500 $63,200 $37,000 $94,800 $55,500 $126,400 $74, $29,000 $15,800 $58,000 $31,600 $87,000 $47,400 $116,000 $63, $26,600 $13,300 $53,200 $26,600 $79,800 $39,900 $106,400 $53, $24,200 $12,100 $48,400 $24,200 $72,600 $36,300 $96,800 $48, $22,000 $11,000 $44,000 $22,000 $66,000 $33,000 $88,000 $44, $20,500 $10,250 $41,000 $20,500 $61,500 $30,750 $82,000 $41, $20,500 $10,250 $41,000 $20,500 $61,500 $30,750 $82,000 $41, $14,400 $7,200 $28,800 $14,400 $43,200 $21,600 $57,600 $28, $11,500 $5,750 $23,000 $11,500 $34,500 $17,250 $46,000 $23, $9,400 $4,700 $18,800 $9,400 $28,200 $14,100 $37,600 $18, $8,200 $4,100 $16,400 $8,200 $24,600 $12,300 $32,800 $16,400 Note: You need to apply for TPD cover from ages 65 to 69, otherwise cover stops at age 65. Cover can be extended if you apply within the 12 months before turning 65, subject to acceptance by the Insurer. Case study Emily is 41 years old and has a bookkeeping business. She s been a member of Cbus for a couple of years, and after reviewing her finances has decided to increase her insurance cover. Emily currently has 4 units of Death and TPD cover and wants to apply for an additional 2 units of cover. Emily s insurance cover Amount of Death cover 6 x $72,400 = $434,400 Amount of TPD cover 6 x $72,400 = $434,400 Total cost per week 6 x $3.58 = $21.48 Emily completes an Application to increase insurance cover and supplies information about her health to the Insurer. 10 Insurance handbook for Sole Traders

11 Professional scale This is your scale if you: perform work of an entirely sedentary professional nature, and perform a minimum of 80% of work in an office environment, and don t perform any manual (physical) work, and have an Annual Taxable Income of more than $100,000 (which can be applied pro rata for permanent part-time workers), and either of the following applies: - you hold a university qualification (Bachelor degree or above), or - you re a Senior Manager or Executive within the organisation in which you re employed (see definitions on page 35). 1 unit 2 units 3 units 4 units Age $3.58 a week $7.16 a week $10.74 a week $14.32 a week Death TPD Death TPD Death TPD Death TPD $153,125 $153,125 $306,250 $306,250 $459,375 $459,375 $612,500 $612, $149,250 $149,250 $298,500 $298,500 $447,750 $447,750 $597,000 $597, $145,125 $145,125 $290,250 $290,250 $435,375 $435,375 $580,500 $580, $141,125 $141,125 $282,250 $282,250 $423,375 $423,375 $564,500 $564, $136,750 $136,750 $273,500 $273,500 $410,250 $410,250 $547,000 $547, $132,125 $132,125 $264,250 $264,250 $396,375 $396,375 $528,500 $528, $127,500 $127,500 $255,000 $255,000 $382,500 $382,500 $510,000 $510, $120,875 $120,875 $241,750 $241,750 $362,625 $362,625 $483,500 $483, $114,375 $114,375 $228,750 $228,750 $343,125 $343,125 $457,500 $457, $107,750 $107,750 $215,500 $215,500 $323,250 $323,250 $431,000 $431, $101,250 $101,250 $202,500 $202,500 $303,750 $303,750 $405,000 $405, $94,375 $94,375 $188,750 $188,750 $283,125 $283,125 $377,500 $377, $90,500 $90,500 $181,000 $181,000 $271,500 $271,500 $362,000 $362, $86,625 $86,625 $173,250 $173,250 $259,875 $259,875 $346,500 $346, $82,750 $82,750 $165,500 $165,500 $248,250 $248,250 $331,000 $331, $79,000 $79,000 $158,000 $158,000 $237,000 $237,000 $316,000 $316, $76,875 $76,875 $153,750 $153,750 $230,625 $230,625 $307,500 $307, $76,250 $76,250 $152,500 $152,500 $228,750 $228,750 $305,000 $305, $75,500 $75,500 $151,000 $151,000 $226,500 $226,500 $302,000 $302, $75,250 $75,250 $150,500 $150,500 $225,750 $225,750 $301,000 $301, $75,125 $75,125 $150,250 $150,250 $225,375 $225,375 $300,500 $300, $74,750 $59,125 $149,500 $118,250 $224,250 $177,375 $299,000 $236, $69,125 $54,375 $138,250 $108,750 $207,375 $163,125 $276,500 $217, $63,500 $49,625 $127,000 $99,250 $190,500 $148,875 $254,000 $198, $57,125 $42,375 $114,250 $84,750 $171,375 $127,125 $228,500 $169, $52,750 $33,125 $105,500 $66,250 $158,250 $99,375 $211,000 $132, $49,500 $33,125 $99,000 $66,250 $148,500 $99,375 $198,000 $132, $46,250 $29,750 $92,500 $59,500 $138,750 $89,250 $185,000 $119, $43,000 $26,375 $86,000 $52,750 $129,000 $79,125 $172,000 $105, $39,500 $23,125 $79,000 $46,250 $118,500 $69,375 $158,000 $92, $36,250 $19,750 $72,500 $39,500 $108,750 $59,250 $145,000 $79, $33,250 $16,625 $66,500 $33,250 $99,750 $49,875 $133,000 $66, $30,250 $15,125 $60,500 $30,250 $90,750 $45,375 $121,000 $60, $27,500 $13,750 $55,000 $27,500 $82,500 $41,250 $110,000 $55, $25,625 $12,813 $51,250 $25,626 $76,875 $38,439 $102,500 $51, $25,625 $12,813 $51,250 $25,626 $76,875 $38,439 $102,500 $51, $18,000 $9,000 $36,000 $18,000 $54,000 $27,000 $72,000 $36, $14,375 $7,188 $28,750 $14,376 $43,125 $21,564 $57,500 $28, $11,750 $5,875 $23,500 $11,750 $35,250 $17,625 $47,000 $23, $10,250 $5,125 $20,500 $10,250 $30,750 $15,375 $41,000 $20, $10,250 $5,125 $20,500 $10,250 $30,750 $15,375 $41,000 $20,500 Note: You need to apply for TPD cover from ages 65 to 69, otherwise cover stops at age 65. Cover can be extended if you apply within the 12 months before turning 65, subject to acceptance by the Insurer. Case study Max is a 45 year old architect, who wants to apply for cover above the Default level (1 unit of Death and TPD) when joining. He decides to apply for an additional 2 units of Death and TPD by completing an Application to increase insurance cover and supplying information about his health to the Insurer. Max s insurance cover Amount of Death cover 3 x $76,875 = $230,625 Amount of TPD cover 3 x $76,875 = $230,625 Total cost per week 3 x $3.58 = $10.74 Insurance handbook for Sole Traders 11

12 6 Changing or increasing your Death and TPD cover You can apply to change your Death and TPD cover at any time. if you re a Manual member: - you can apply for equal Death and TPD cover up to a maximum of 10 units of Death and 20 units of TPD. For example, at age 40: 10 units of Death = $520,000 and 20 units of TPD = $520, you don t need to have equal Death and TPD cover if you don t want to. You can apply to have any combination of Death and TPD cover (up to the limits shown above) as long as the dollar value of your TPD cover doesn t exceed your Death cover. For example, at age 40 you could choose to have 10 units of Death = $520,000 and 15 units of TPD = $390, if you need more than 10 units of Death cover and 20 units of TPD cover, then you can only apply for 1 additional unit of TPD cover for each unit of Death cover. This means you can t choose to have an equal dollar value of Death and TPD cover if you want more than 10 units of Death cover and 20 units of TPD cover. Applying to change your cover when you join When completing your Join Cbus Sole Trader Super form you can apply to change your occupation category from Manual to the Non-Manual or Professional occupation category. If you re eligible, the Non-Manual and Professional categories provide a higher level of cover than you would have under the Manual category. Read Occupation categories for Death and TPD cover on page 7 for more information. Applying to change your cover after you join You can apply to increase your Death and TPD cover at any time by completing an Application to increase insurance cover. Increases to cover depend on approval by our Insurer. Limits on Death and TPD cover There s a limit (maximum cover level) on the amount of Death and TPD cover you can apply for under Cbus Sole Trader Super: for ages 15 to 69, you can apply for up to $5 million Death cover and $2 million TPD cover. Note: The maximum of $2 million for TPD cover applies to all cover you hold with any super fund or insurance policy, not just cover you have with us. the dollar value of your TPD cover can t be more than the dollar value of your Death cover. if you re a Non-Manual or Professional member, the amount of TPD cover you can have is limited to seven times your Annual Taxable Income. The Insurer may not approve your application if the number of units you choose provides TPD cover that s more than that amount. Example At age 40, if you wanted to apply for 15 units of Death cover, the maximum number of TPD units you could apply for would be 25 as shown in the table below: Death cover 8 units = $416, units = $520, units = $572, units = $624, units = $676, units = $728, units = $780,000 TPD Cover 8 units x 2 = 16 units ($416,000) 10 units x 2 = 20 units ($520,000) 20 units + 1 = 21 units ($546,000) 20 units + 2 = 22 units ($572,000) 20 units + 3 = 23 units ($598,000) 20 units + 4 = 24 units ($624,000) 20 units + 5 = 25 units ($650,000) You can have equal Death and TPD cover up to 10 units of Death and 20 units of TPD. You can only apply for 1 additional unit of TPD cover for each unit of Death cover above 10. How much will extra Death and TPD cover cost? The cost of cover depends on the number of units you choose, the type of cover and your occupation category. Type of cover Weekly cost per unit Manual Non-Manual Professional Death and TPD $3.58 $3.58 $3.58 Death Only $1.33 $1.55 $1.55 Additional TPD* $2.25 Not Available Not Available * Only Manual members can apply for more TPD units of cover than Death units of cover, subject to the limitations outlined above. 12 Insurance handbook for Sole Traders

13 How the Insurer decides if you can increase your Death/TPD cover The Insurer may ask you for more health information or to have medical tests to help them assess your application. Your increased cover depends on the Insurer accepting your application. If they accept it, we ll let you know in writing what date your increased cover starts and the occupation category you re covered under. The Insurer will only consider your application if: you re age 15 or over and under age 70, and you re not currently applying for, not entitled to, or haven t been paid a TPD or terminal illness benefit from any super fund or life insurance policy, and you complete all sections of the Application to increase insurance cover and supply any other information the Insurer asks for, and we receive your application no later than 31 days after you ve completed, signed and dated the form, and if you re a Professional member, your Annual Taxable Income was more than $100,000 in the last financial year. Your duty of disclosure It s important to answer all questions truthfully and correctly to the best of your knowledge when applying to increase your insurance cover. You need to read the Your duty of disclosure on the Application to increase insurance cover, so that you re aware of what can happen in the event of non-disclosure. The Insurer can refuse to pay a claim if you didn t tell them about any issues you currently have, or have had in the past, that are relevant to your application. How to apply for more Death and TPD cover Complete an Application to increase insurance cover at (or call us for a copy on ) and make sure you: answer all insurance eligibility questions, give information about your current and past health if the Insurer asks for it, and submit your completed application so we receive it within 31 days of you signing and dating the form. If you re accepted for an increase in cover, it will start from the date the Insurer accepts your cover, provided that you have a minimum account balance of $250 within 31 days of the date the application is accepted. Insurance handbook for Sole Traders 13

14 6 Changing or increasing your Death and TPD cover (continued) How to transfer Death and/or TPD cover from your previous super funds If you have Death only or Death and TPD cover with another super fund or life insurance policy, you may be able to transfer it to Cbus Sole Trader Super. Am I eligible? To be eligible to transfer your existing cover: complete all sections of the Application to transfer existing insurance cover. We must receive your completed application within 31 days of you signing and dating the form, and attach a copy of your most recent statement from your previous super fund or life insurance company to prove your cover and the amount you re insured for, and the cover you want to transfer must not have any loadings. If it does, you won t be eligible to transfer cover to Cbus Sole Trader Super, and if the cover you want to transfer has any conditions, exclusions or restrictions, this may be transferred subject to acceptance by the Insurer, and if the cover is under your previous super fund, you must transfer your entire account balance from that fund to Cbus Sole Trader Super, and you must confirm that your cover in your previous fund or life insurance policy will be cancelled when your cover starts with us. You won t be able to claim a benefit from us if you don t cancel your old cover, and you must agree not to and must not take up any continuation option or request reinstatement of the cover under your previous fund or life insurance policy, and the maximum of each Death and TPD cover you can transfer is $1 million, and your total cover must not be more than the maximum cover levels under the Cbus Insurance Policy (see Limits on Death and TPD cover on page 12 for details), and you must confirm you re in Active Employment. If you re not in Active Employment, you can t transfer your cover to Cbus Sole Trader Super, and you re not currently applying for, not entitled to, or haven t been paid a TPD or terminal illness benefit from any super fund or life insurance policy, and you must confirm you don t have, or never have had, any disease, Illness or Injury, or any other conditions (other than colds, flu or mild asthma) which: - have required more than a total of 2 weeks off work during the last 12 months, or - have happened more than twice in the last 2 years and/or are currently causing you symptoms or needing treatment. What happens next? If the Insurer accepts your application, your cover under your previous super fund or life insurance policy will be matched by us, and rounded up to the next whole unit of cover. This is on top of any cover you may already have under Cbus Sole Trader Super. From the date your Application to transfer existing insurance cover is accepted, your cover and all terms and conditions will be based on the Cbus Insurance Policy, and not the basis of cover that applied under your previous super fund or life insurance policy. Important Note: Cover transfers depend on the answers you give on your application form. So it s important you don t cancel your cover with your previous super fund or insurance policy until we confirm your Application to transfer existing cover has been accepted. How to apply to transfer your cover Complete an Application to transfer existing insurance cover at or call us on for a copy, making sure you: answer all insurance eligibility questions, and attach a copy of your most recent statement from your previous super fund or life insurance company. We must receive your completed form within 31 days of you signing and dating it. 14 Insurance handbook for Sole Traders

15 Example changing from Manual to Non-Manual How to change your Death and TPD occupation category after you ve joined If you feel the occupation category you re currently covered under is no longer right for you, you can apply to change this by completing an Application to change occupation category. Changing occupation categories from: Manual to Non-Manual Manual to Professional Non-Manual to Professional For the above scenarios, the dollar value of your cover at the time of applying will be matched and rounded up (if necessary) to the next whole unit of the occupation category you re changing to. If a change in occupation category results in a higher level of cover than you had previously, you must be in Active Employment on the date that cover increases. If you re not, the extra cover you receive will be for New Events Cover for Death and TPD. Cover for all events will start from the date you re in Active Employment. If you currently have 4 units of Manual cover and you re age 30 when you apply to change your category, you would get: Category Current cover under Manual How to apply to change your occupation category New cover under Non-Manual Number of Death units 4 2 Number of TPD units 4 1 Death cover $208,000 $238,800 TPD cover $104,000 $119,400 Cost per week $14.32 $5.13 To apply to change your occupation category, complete an Application to change occupation category at or call us on for a copy. 7 When does your Death and TPD cover stop? Once your insurance cover with Cbus has started, you ll stay covered until the earlier of the following dates: the date we receive your satisfactorily completed Application to decrease or cancel insurance cover requesting cancellation of your cover, you re no longer a Cbus member, you reach age 65 for TPD cover and haven t applied to continue your TPD cover to age 70 and had your application accepted, you reach age 70 for Death cover and for TPD cover if your cover has been extended beyond age 65, you join the armed forces of any country other than the Australian Defence Force Reserves, the Insurer admits a TPD or terminal illness benefit to you, you die, or there isn t enough money in your super account to cover the cost of your insurance and account administration fee. Your cover will stop on the last day of the month for which your account could still meet the cost of your insurance. Insurance handbook for Sole Traders 15

16 8 Restarting your Death and TPD cover after it s been cancelled or expired If you cancelled your cover If you cancelled your insurance cover and want to restart it you ll need to complete an Application to increase insurance cover and provide information about your health. You can download a form at or call us on for a copy. Read Applying to change your cover after you join on page 12 for more information. If your cover expired because you ran out of money If your cover stops because your account balance has fallen to $0.00, the type of contribution that Cbus next receives on your behalf could change which Cbus super plan your membership continues under. What type and when was your next contribution received If your next contribution is an Employer Superannuation Guarantee Contribution What level and type of cover will you receive you ll be transferred to Cbus Industry Super and won t be eligible to apply for IP cover. Read What happens if you start to receive Employer Contributions in Cbus Sole Trader Super on page 25 for more information. Important note: You ll be covered only for injuries and illnesses that first occur after the date your cover restarted, unless you complete an Application to increase insurance cover and it has been accepted by the Insurer. Your cover will only restart if: you re not currently applying for, not entitled to, or haven t been paid a TPD benefit from any super fund or life insurance policy. If you don t meet this condition, and you joined Cbus before 1 November 2015, you ll only be entitled to Death cover. If you don t meet this condition and you joined Cbus on or after 1 November 2015, you re not entitled to any cover with us, you re not currently applying for, not entitled to, or haven t been paid a terminal illness benefit from any super fund or life insurance policy, and you haven t previously cancelled your cover. If your next contribution is a personal contribution (e.g. contributions made by you instead of an employer) and we receive a contribution, sufficient to meet the cost of your insurance within six months of your cover stopping If your next contribution is a personal contribution (e.g. contributions made by you instead of an employer) and we receive your contribution more than 6 months after your cover stopped you ll stay in Cbus Sole Trader Super and Death and TPD cover will restart at the same type and level of cover you held before your cover stopped. If you need help to work out your minimum contribution amount, call us on Note you won t receive IP cover, read Restarting your IP cover after it s been cancelled or expired on page 24 for more information. you ll stay in Cbus Sole Trader Super and in most cases you ll only be eligible for 1 unit of cover. Note you won t receive IP cover. Read Restarting your IP cover after it s been cancelled or expired on page 24 for more information. 16 Insurance handbook for Sole Traders

17 9 About IP cover IP cover occupation categories How much cover can IP insurance give you? Before you work out how many units of IP cover you want, you need to know how much money each unit of cover is worth and may cost. Each unit of cover is worth $100 per week and the cost of each unit will depend on: your age which occupation category you get cover under which waiting period you choose which benefit period you choose, and whether you choose only or and Illness cover. The sections on the following pages will help you work out how much IP insurance is right for you and your family. Occupation categories for IP cover There are three occupation categories for IP cover, so the category that applies to your IP cover may be different from the one you have for Death and TPD cover. Your IP occupation category will depend on the answers you give about your job in your Join Cbus Sole Trader Super form. Your answers may be checked by the Insurer if you make an IP claim. Some occupations are not eligible for IP cover. These are called Excluded Occupations (see page 33). Occupation category Non-Manual Skilled Trades Manual Eligibility Perform work of a clerical, administrative, managerial or professional nature, and Perform a minimum of 80% of your work in an office environment, and Don t perform any manual (physical) work. Examples are: Bookkeeper, Tax Adviser, Insurance Broker This category applies if you confirm that you: perform manual work or spend more than 20% of your time outside of an office environment, and you hold, or you have completed at least one of the following in the field within which you are working: - An indentured, trainee or modern apprenticeship - An Australian Recognised Trade Certificate (ARTC) - An Offshore Technical Skills Record (OTSR) - A Degree Examples are: A fully qualified Carpenter, Electrician or Plumber This category applies if you don t fit into either of the above two categories. If you change jobs and believe your current IP cover occupation category is no longer right for you, you can apply to change it. Call us on for assistance. If you re working in an Excluded Occupation, you may be able to get IP cover through the Cbus Income Continuance Portfolio *. This can give you basic, good value IP cover against accident or illness. Note: because this type of IP cover is provided outside of Cbus Sole Trader Super, the insurance costs would be paid by you (not from your Cbus account directly to the Insurer). For more information call Cbus Income Continuance Portfolio on * The Insurer of this product is CGU Insurance Limited ABN AFSL Insurance handbook for Sole Traders 17

18 10 Changing or increasing your IP cover Applying to change your occupation category when you join You can apply to change your occupation category from Manual to Non-Manual or Manual to Skilled Trades when you complete your Join Cbus Sole Trader Super form. If you re eligible, changing to the Non-Manual or Skilled Trades category means you d pay lower insurance costs for the same amount of cover. Read Occupation categories for IP cover on page 17. The table below shows the amount 6 units of Default Manual only cover (on a 30-day waiting period and 2-year benefit period) will cost you per week based on your age, compared to how much 6 units of Non-Manual or Skilled Trades cover will cost. Read Default Insurance cover on page 5 for more information on receiving Default cover when you join. Weekly cost for Default only cover Occupation category Non-Manual $1.38 $1.32 $1.26 $1.44 $1.74 Skilled Trades $2.16 $2.04 $1.92 $2.16 $2.64 Manual $4.08 $3.96 $3.72 $4.32 $5.16 Occupation category Non-Manual $2.16 $2.64 $3.18 $3.66 $3.66 Skilled Trades $3.36 $4.14 $4.98 $5.82 $5.88 Manual $6.48 $7.98 $9.54 $10.92 $11.04 Remember: only cover won t pay a benefit if you can t work due to Illness. Other IP cover options Option Type of cover Change from Default only cover Change to and Illness cover See Step 1 Cover amount 6 units More or less than 6 See Step 2 units Note: the maximum amount of cover you can apply for is limited to the lesser of 85% of your Monthly Income or 46 units. Waiting period 30 days 90 days See Step 3 Benefit period 2 years 5 years See Step 4 If you want more IP cover after you join You can apply for more IP cover, or a different type of IP cover, after you join Cbus. Why might I need more or different IP cover? There s a simple way to work out if you need more cover than the 6 units of only cover you may get when you join: 1. Think about how much you earn each week right now. The Default 6 units of IP cover that you may be eligible for when you join, provides a benefit of up to $600 per week (or $31,200 per annum). This is based on a benefit of 85% of income, for weekly pre-tax earnings of $ per week or $36,706 per annum. 2. If the amount you earn each week is higher than this, you could need more than 6 units of IP cover if you want to make sure you are insured for the maximum benefit of 85% of your income. 3. You don t have to apply for more units of IP cover if you don t want to. But if you need to claim, your benefit will be limited to the amount provided by the number of units you have. This means you will be insured for a benefit which is less than 85% of your weekly earnings. 18 Insurance handbook for Sole Traders

19 Step 1: Choose which type of IP cover you need You can choose from 2 different types of IP cover: only or and Illness. Default IP cover is for only. Deciding whether only or and Illness IP is right for you comes down to three things: peace of mind, the cost of cover and which type of cover best suits you and your family. only This type of IP cover pays you a benefit only if you claim because you ve had an. It doesn t cover you for accidents you had before your application has been accepted by the Insurer, and it doesn t pay you a benefit if you can t work because you re ill. and Illness cover This type of IP cover pays you a benefit if you become ill, as well as if you have an accident, after your application for this cover is accepted. Step 2: Choose how much cover you need 1. Work out how much money you would need to replace your income if you were unable to work due to an or (where approved), Illness. 2. Check the table Maximum IP payments and find the income range which covers your annual salary. This will let you see how many units you need to cover up to 85% of your annual income. This is the highest amount you can be covered for under Cbus Sole Trader Super. Each unit of cover can pay you $100 per week. Default cover provides you with 6 units of only IP cover. 3. You do not have to apply for the number of units of IP cover shown in the table if you do not want to but if choose to have less units, you will be insured for a benefit which is less than 85% of your weekly earnings. Limits on IP cover payments If you have to make an IP claim, your Monthly Benefit will be limited to the lesser of: 85% of your Monthly Income (where 75% will be paid directly to you as an income replacement and 10% to your Cbus Sole Trader Super account) or the benefit paid by the number of units you have (where 75/85ths will be paid directly to you as an income replacement and 10/85ths will be paid to your Cbus Sole Trader Super account) or $20,000 per month. So if you apply for cover that would pay more than 85% of your income, you ll be paying for more cover than you d be eligible to get if you make an IP claim. Maximum IP payments This table shows the number of units you need to receive the maximum IP payment you could get based on your annual income: Units of cover Your annual pre-tax income Units of cover Your annual pre-tax income 1 $0.00 $6, $73,412 $79,529 2 $6,118 $12, $79,530 $85,647 3 $12,236 $18, $85,648 $91,764 4 $18,353 $24, $91,765 $97,882 5 $24,471 $30, $97,883 $104,000 6 $30,589 $36, $104,001 $110,117 7 $36,706 $42, $110,118 $116,235 8 $42,824 $48, $116,236 $122,352 9 $48,942 $55, $122,353 $128, $55,059 $61, $128,471 $134, $61,177 $67, $134,589 $140, $67,295 $73, $140,706 $146,823 Insurance handbook for Sole Traders 19

20 10 Changing or increasing your IP cover (continued) Step 2: Choose how much cover you need continued Example 2: Default cover of six units Jarrod has an annual income of $65,000. He has the Cbus Default IP cover (6 units). Each unit gives him $100 per week ($100 x 6 units x 52 weeks = $31,200). If he makes a claim, Jarrod will be paid the lesser of six units ($31,200) and 85% of his annual income = $55,250. If Jarrod claims, his insured monthly benefit will be limited to six units = $2,600 per month Example 1: Maximum cover for your annual income Robert has an annual income of $84,000. He wants the highest benefit possible so he chooses to be covered for 14 units. Each unit insures him for $100 per week or $72,800 per annum ($100 x 14 units x 52 weeks = $72,800). This gives him an insured amount closest to 85% of his income (85% x $84,000 = $71,400). Robert applies for the extra number of units over the Default to make 14 units. If he claims a benefit, Robert will be paid the lesser of 14 units ($72,800) and 85% of his salary ($71,400) while he s disabled. If Robert claims and his annual income is still $84,000, his insured monthly benefit will be 85% of his income = $5,950 per month (85% of $84,000 divided by 12 months) How Robert s benefit will be paid $700 will be paid to Robert s super account each month as a contribution (10/85ths x $5,950) $5,250 less Pay-as-you-go (PAYG) withholding tax will be paid directly to Robert each month to replace his lost earnings (75/85ths x $5,950) ($100 per week x 6 units x 52 weeks divided by 12) How Jarrod s benefit will be paid $ will be paid to Jarrod s super account each month as a contribution (10/85ths x $2,600) $2, less Pay-as-you-go (PAYG) withholding tax will be paid directly to Jarrod each month to replace his lost earnings (75/85ths of $2,600) If your annual income is more than $146,823 Use the formula below to calculate the number of IP units you need. Annual income x = Number of units you need* Make sure you round the number of units up to the nearest whole number. Example John s before tax income is $155,000. $155,000 times (x) 0.85 divided by ( ) 52 divided by ( ) 100 = 25.3 units This means that John would need 26 units of IP insurance to cover 85% of his annual income. * Note: the total number of units is limited to 46, based on the maximum income for IP insurance of $281,411 p.a. 20 Insurance handbook for Sole Traders

21 Step 3: Choose your waiting period for IP benefit payments The waiting period is the amount of time you have to wait before you can be paid a benefit. You have two waiting period options: 30 days or 90 days. Default IP cover has a 30-day waiting period. During the waiting period, you may not be receiving any income, which could mean relying on savings to pay your household expenses. Which waiting period should I choose? To work out which waiting period would suit your needs: write down how much you spend each month, add a buffer for extra expenses (such as car registration and insurance) divide that amount by 30 (the number of days in the Default waiting period) That s a simple calculation of how much money you ll need each day to get by while you serve your waiting period and wait for your claim to be assessed. If you think you could afford to cover this amount for a longer period, you may want to think about increasing your waiting period to 90 days. How does the waiting period work? Your waiting period starts on the day you first receive medical advice from a Doctor that you have a Total Disability. You don t get paid any benefits from Cbus during the waiting period. To be entitled to a Total Disability or Partial Disability benefit, you must have been Totally Disabled for a continuous period of at least the first 14 consecutive days of the waiting period, and Totally or Partially Disabled during the reminder of the Waiting Period. Why do some waiting periods cost less? Each waiting period has a different cost. The shorter the waiting period is, the higher your insurance premium will be because you ll start to receive payments earlier if your claim is admitted. So while the 90-day waiting period is cheaper than 30 days, it could seem a long time if you didn t have enough money to see you through. How to change your waiting period You can change from a 30-day to a 90-day waiting period at any time without giving health evidence by writing to Cbus. But if you choose a 90-day waiting period and then decide to go back to 30 days, you will have to complete an Application to vary income protection cover which includes providing information relevant to your application. Step 4: Choose your benefit period The benefit period is the maximum amount of time your claim would be paid for or Illness (where approved) while you have a Total Disability or Partial Disability. There are two benefit periods: 2 years or 5 years. Default IP cover has a 2-year benefit period. The benefit period you choose will affect the cost of your cover. The longer your payment period is, the higher your premium will be. Which benefit period should I choose? Before you choose your benefit period, think about: how you and your family would manage if you couldn t work due to Injury or Illness this could be a few months, or many years what savings and assets (like shares or property) you have to cover your expenses now and into the future what debts or other costs you re currently paying off. If you choose and are accepted for a 5-year benefit period: and you make a successful claim, the Monthly Benefit will, at the end of each consecutive 12 month period for which a Disability Benefit is payable, increase by the lesser of, subject to the Maximum Cover Limit: - the annual Consumer Price Index (CPI) percentage increase, or - 5% * * This feature is not available for cover with a 2-year benefit period. If you have been accepted by the Insurer for a 5-year benefit period, you can decrease this to a 2-year period at any time by writing to Cbus. How to change your benefit period You can change from the Default 2-year benefit period to a 5 year benefit period at any time by completing an Application to vary income protection cover form which includes providing information about your health. Any increase in your benefit period will be subject to Cbus and the Insurer accepting your application and will start from the date we advise you in writing. Insurance handbook for Sole Traders 21

22 10 Changing or increasing your IP cover (continued) Step 5: Check your IP cover cost The cost of your IP cover depends on: your age the type of IP cover you choose ( only or and Illness) your waiting period (30 days or 90 days) your benefit period (2 or 5 years), and your occupation category (Manual, Skilled-Trades or Non-Manual). Your occupation category for IP cover is based on the answers you give about your job in your Join Cbus Sole Trader Super form. If you re not sure which category is right for you, read Occupation categories for IP cover on page 17. The cost for your IP cover is deducted from your Cbus Sole Trader Super account. The cost in the following tables is shown as a cost per unit per week. Table A Income Protection waiting period of 30 days Age 2-year benefit period 5-year benefit period Non-Manual Skilled-Trades Manual Non-Manual Skilled-Trades Manual only and Illness only and Illness only and Illness only and Illness only and Illness only and Illness Table B Income Protection waiting period of 90 days Age 2-year benefit period 5-year benefit period Non-Manual Skilled-Trades Manual Non-Manual Skilled-Trades Manual only and Illness only and Illness only and Illness only and Illness only and Illness only and Illness 22 Insurance handbook for Sole Traders

23 Changing your IP cover type or amount Before you apply to change your IP cover, you should: check if you re eligible (see page 5) check your occupation is not on the Excluded Occupation list (see page 33) check if the Default IP cover you already have (see page 5) is enough for you, or if you need more cover, a different waiting period and/or a longer benefit period. How the Insurer decides if you can have more IP cover The Insurer may ask you for more health information or to have medical tests to help them assess your application. If they accept your application, we ll let you know in writing when your new IP cover starts and which occupation category you re covered under. Your duty of disclosure You need to read the important information in the application form about Your duty of disclosure and what can happen in the event of non-disclosure. The Insurer can refuse to pay a claim if you did not tell them on your application form about any issues you currently have, or have had in the past, relevant to your application. The Insurer will only consider your application if: you re age 15 or over and under age 65, and you re an Australian Resident, and you re working 15 or more hours a week when you apply, and you re not working in an Excluded Occupation, and you re not currently applying for, not entitled to, or haven t been paid a TPD or terminal illness benefit from any super fund or life insurance policy, and you ve not been diagnosed with an illness that s likely to lead to your death within 24 months from the date of your diagnosis, and you complete all sections of the Application to vary income protection cover form and give any other information the Insurer may ask for, and we receive your application no later than 31 days after you ve completed, signed and dated the form. Temporary cover (while your application is being assessed) How to apply to change your IP cover Complete an Application to vary income protection cover form at or call the Cbus Service Centre for a copy on , and make sure you ve: answered all questions on the application and attached any extra information needed provided information about your current and past health if the Insurer asks for it chosen the type and amount of cover, waiting period and benefit period you want signed and dated the Declaration, and submitted your completed application so that we receive it within 31 days from when you ve signed and dated it. If you re accepted for an increase in cover, it will start from the date the Insurer accepts your cover, provided that you have a minimum account balance of $250 within 31 days of the date the application is accepted. If you apply for more IP cover, you ll receive temporary cover known as interim accident cover. This covers you if you have an while your application is being assessed. Interim accident cover: starts on the date the Insurer receives your satisfactorily completed application, and will continue for up to 90 days provided you continue to be an Eligible Person, or until your application is finalised or withdrawn (whichever happens first), and covers you for up to: the lesser of the benefit amount you would have if your application was accepted, 85% of your Monthly Income, or $10,000 per month, and for members with existing cover, the benefit period and waiting period that will apply will be what was effective prior to the receipt of the application for increased cover, and for those members with no existing cover, the benefit period will be 2 years and the waiting period will be 90 days. Insurance handbook for Sole Traders 23

24 11 When does IP cover stop? Once your IP cover starts, you ll stay covered until: you turn 65, or the date Cbus receives your satisfactorily completed Application to decrease or cancel insurance cover form requesting cancellation of your cover, or you make a fraudulent claim, or you re no longer an Australian Resident, or your account balance is too low to cover the cost of your insurance. Your cover will stop on the last day of the month for which your account could still meet the cost of your insurance, or you re no longer a member of Cbus Sole Trader Super, or you join the armed forces of any country other than the Australian Defence Forces Reserve, or you die, or the date the Insurer approves your application for a TPD or terminal illness benefit. However, if you re being paid an IP benefit at this time, IP payments will continue until you meet a condition of cessation of benefits or your cover stops. (See When your IP claim payments will stop on page 30). 12 Restarting your IP cover after it s been cancelled or expired If you cancelled your cover If you cancelled your insurance cover and want to restart it you ll need to complete an Application to vary income protection insurance cover form and provide information about your health. You can download a form at or call the Cbus Service Centre on for a copy. Read If you want more IP cover after you join on page 18 for more information. If your cover expired because you ran out of money If your IP cover stops because your account balance has fallen to $0.00, the type of super contribution Cbus next receives on your behalf will determine which insurance cover and membership category you are entitled to. What type and when was your next contribution received If your next contribution is an Employer Superannuation Guarantee Contribution If your next contribution is a personal contribution (e.g. contributions made by you instead of an employer) What level and type of cover will you receive you will be transferred to Cbus Industry Super and won t be eligible to apply for IP cover. Read What happens if you start to receive Employer Contributions in Cbus Sole Trader Super on page 25 for more information. you will stay in Cbus Sole Trader Super. IP cover will not automatically restart and you will need to apply for IP cover. 24 Insurance handbook for Sole Traders

25 13 What happens if you start to receive Employer Contributions in Cbus Sole Trader Super? If you have insurance cover under Cbus Super for Sole Traders If Cbus starts to receive Employer Superannuation Guarantee Contributions for you, and you have insurance cover under Cbus Sole Trader Super, you will remain a member of Cbus Sole Trader Super and your existing level and type of insurance cover will continue. You can apply to transfer your membership account to Cbus Industry Super at any time by completing an Application to change existing membership to Cbus Industry Super. However, if your application to transfer your cover is successful, any Death only or Death and TPD cover you have will transfer with you. You ll keep your existing Manual, Non-Manual or Professional occupation category unless you apply to change it. Your IP cover will stop if you transfer to Cbus Industry Super. If you start to have Employer Superannuation Guarantee Contributions paid for you, and you remain a Sole Trader Super member with IP cover, check you don t also have IP cover through this employer or a related employer scheme. This could mean you re over-insured for IP because, if you claim an IP benefit, you can only be paid up to 85% of your Monthly Income (75% + 10% super) including income from all sources. Read IP claims on page 29 (particularly When your claim payments will be reduced) for details. If your cover stops under Cbus Sole Trader Super If your insurance cover has stopped because your account balance has fallen to $0.00 and you start to receive Employer Superannuation Guarantee Contributions into your Cbus Sole Trader Super account: you ll be transferred to Cbus Industry Super and your cover will start from the first day of the period for which the first On-Time Employer Contribution relates if you re eligible for cover (as outlined on this page) if we receive an Employer Superannuation Guarantee Contribution that s not On-Time, you ll still be transferred to Cbus Industry Super but your cover won t start until your first On-Time Employer Contribution is received; if you re eligible for cover under Cbus Industry Super, you ll automatically receive its Default cover: - 2 units of Manual Death and TPD if you re under the age of 21; or - 4 units of Manual Death and TPD if you re age 21 or over. Any IP cover you had under Cbus Sole Trader Super will stop. Are you eligible for cover under Cbus Industry Super? You ll be eligible if: you re a member of Cbus, and you ve not reached age 70 when cover starts under Cbus Industry Super, and you re in Active Employment on the date your cover starts under Cbus Industry Super. If you re not in Active Employment, you ll receive Death and New Events Cover for TPD until you re once again in Active Employment, when you ll receive Death and TPD cover for all events, and you re not currently applying for, not entitled to, or haven t been paid a TPD or terminal illness benefit from any super fund or life insurance policy, and you ve not been diagnosed with an illness that s likely to lead to your death within 24 months from the date of your diagnosis. If you re aged 65 or over, TPD cover won t automatically start under Cbus Industry Super. You ll need to apply for TPD cover. If you have since last becoming a member of Cbus cancelled all your Death and/or Total and Permanent Disablement cover under the Cbus Insurance Policy, prior to receipt of the On-time Employer Contribution, you will still transfer to Cbus Industry Super but the type of cover cancelled will not commence under Cbus Industry Super. The receipt of Default Cover is subject to the following additional conditions: where you ve applied for, are entitled to, or have been paid a terminal illness benefit from any super fund or life insurance policy, you won t be eligible for Default cover; or where you ve applied for, are entitled to, or have been paid a total and permanent disablement benefit from any super fund or life insurance policy, you will receive death cover only as Default cover. Changing from Manual to Non-Manual or Professional cover You can apply to change your occupation category from Manual to Non-Manual or Professional using the Application to change occupation category at or call us on for a copy. Default IP cover in Industry Super Default IP cover is not available through Cbus Industry Super, but you can apply for IP cover through the Cbus Income Continuance Portfolio*. Read the Insurance handbook for Industry Super at for details. * The Insurer of this product is CGU Insurance Limited ABN AFSL Read the Insurance handbook for Industry Super at for details on: who is eligible for cover different occupation categories available when cover starts and stops and how to make a claim. If you choose to transfer to Cbus Industry Super If you transfer from Cbus Sole Trader Super to Cbus Industry Super, you won t be able to take any IP cover you currently have under Cbus Sole Trader Super with you. IP cover under the Cbus Sole Trader Super will stop from the date we accept your Application to change existing membership to Cbus Industry Super. Your current level of Death only or Death and TPD cover will transfer with you. You ll keep your existing Manual, Non-Manual or Professional occupation category unless you apply to change it. Insurance handbook for Sole Traders 25

26 14 Making an insurance claim This section gives you information about: how and when you can claim for terminal illness, TPD or IP how your family or dependants can make a claim if you die and who can receive the money (see Rules on who we can pay your super to if you die below). To be able to apply for an insurance payment (benefit), the Insurer and us must agree you re eligible and meet the definitions and conditions in the Cbus Insurance Policy that applies to your claim. To claim a benefit, you or your dependants should contact us on to check eligibility and what conditions have to be met. We ll then send the forms needed to help make the claim. Death claims If you die while you re a Cbus member, your dependants are entitled to claim: the total amount in your account, and any insurance you had at the date of your death. Rules on who we can pay your super to if you die Government rules set out who can and can t get your super and insurance payment if you die. If you haven t completed a binding nomination, we ll decide who to pay. We ll always take into account your nominated beneficiaries (see Choosing who your money goes to at right) as well as any other relevant information provided. People who can get your super and insurance are your dependants and people you have an interdependent relationship with (see the definitions of these terms below). Dependants Your dependants include: your spouse (including de facto and same-sex partners), children (including step or adopted children or children of samesex couples), and other people who are financially dependent on you (wholly or partially) or were in an interdependent relationship with you. Interdependent An interdependency relationship means two people (whether or not related by family) have: a close personal relationship, and live together, and one or each of them provides the other with financial support, and one or each of them provides the other with domestic support and personal care. If two people (whether or not related by family) have a close personal relationship, but do not meet the other requirements above because either, or both, of them suffer from a physical, intellectual or psychiatric disability, they can be considered to have an interdependency relationship. People who share accommodation for convenience, for example flatmates, do not qualify. Choosing who your money goes to When you join Cbus Sole Trader Super (or at any time after), you can choose which of your dependants you want to get your super, and any insurance you have if you die. These people are called your beneficiaries. You can choose your beneficiaries in one of two ways: a non-binding nomination or a binding nomination. Option 1: Non-binding nomination A non-binding nomination means: your benefit will be paid to either your dependant/s or your legal personal representative, and we ll make the final decision. The decision will be made under Cbus Trust Deed and relevant law but will take into account the people you have chosen. You can make a non-binding nomination at Step 3 of your Join Cbus Sole Trader Super form. 26 Insurance handbook for Sole Traders

27 Option 2: Binding nomination A binding nomination means you can lock in who you want your super and insurance to go to if you die as long as: you choose an eligible person to receive your benefit (in accordance with Cbus Trust Deed and relevant legislation) and the eligible person is a dependant or legal personal representative, and you ve made your nomination in the last three years. Important note: To keep your binding death nomination valid, you must renew it every 3 years and it must be signed and dated in the presence of 2 witnesses over the age of 18 and who you haven t nominated to receive your benefit. You can make a binding nomination with the Binding death benefit nomination form at or call us on for a copy. Keeping your nominations up to date We ll send you details of your nominated beneficiaries twice a year on Your annual statement and your Record of contributions. You can also check your beneficiaries online at if you register to use SuperSite. Once you ve nominated a beneficiary, make sure you let us know if your circumstances change (for example if you marry, divorce or have children). Remember, a binding nomination is only valid for three years so you ll need to update it even if your circumstances haven t changed. You can update your non-binding nominations any time at or on the Change of details form at (or call us on ). You can update your binding nominations on the Binding death benefit nomination form at Tax on death benefits Death benefit payments may be taxed when paid, depending on: your relationship to the person receiving the benefit, the parts (components) payable, and definitions that apply under super and tax laws. The definition of a dependant under super law is different than a dependant under tax law. A super death benefit has two components: taxable and tax free. Tax will apply only to the taxable component at the rate as shown in the table below. Payee Superannuation dependant Tax dependant Taxable Tax rate * Surviving Spouse or de-facto (of same YES YES NO NIL or opposite sex) Former spouse NO YES NO NIL Child (including step or adopted child) Minor (under age 18) YES YES NO NIL Child (over age 18) YES NO YES 15% # ** Financial dependant YES YES NO NIL Interdependent YES YES NO NIL Estate^ YES YES NO NIL Non-financial dependant NO NO YES 15% # ** * On taxable component of benefit ** Plus the Medicare levy # If the payee tax file number is not provided the benefit is taxed at 47% (plus the Medicare levy). ^ Your Estate may have to pay tax directly For more information about how your benefit is taxed, go to or seek appropriate tax advice. Insurance handbook for Sole Traders 27

28 14 Making an insurance claim (continued) Terminal Illness Benefit (TIB) claims If you re diagnosed with a Terminal Illness and have a life expectancy of less than 24 months from the date of your diagnosis, you can apply to be paid a TIB. To be eligible for a TIB, you need to give us supporting medical evidence from two Doctors approved by the Insurer (one must be a specialist medical practitioner practising in an area related to the Terminal Illness) confirming you re suffering from a condition which, in the opinion of the Doctor, is likely to lead to your death within 24 months from the date you re diagnosed with a Terminal Illness. To claim, contact us on to check if you re eligible and to get the forms you need to complete. When the Insurer and us agree you ve been diagnosed with a Terminal Illness, they will pay you a TIB if: the date you re diagnosed with a Terminal Illness is on or after the date your cover started or restarted. No TIB can be paid where the date you were diagnosed is before this date, and the TIB is the lesser of your Death benefit or $3 million. If your Death benefit is more than $3 million Cbus will pay the extra number of units as a Death benefit balance (a residual benefit) calculated at your date of death (as long as you stay a member and keep paying the cost of any Death cover you had above $3 million), and if a TIB is approved by the Insurer, all cover under the policy will stop from that date (unless you re eligible to be paid a residual benefit as described above). From the date a TIB claim has been lodged, you can no longer increase your cover with us without the Insurer s prior approval. To be paid a TIB, you must also meet the benefit payment conditions under Cbus Trust Deed and the Superannuation Industry (Supervision) Act (SIS Act) 1993 and Regulations. Note: You can t claim both TIB and a TPD benefit. Terminal medical condition If you re not insured but you meet the definition of terminal medical condition in the SIS Act and Regulations, Government rules may allow us to pay your total super account balance. Call us on for help in this situation. Total and Permanent Disablement (TPD) claims If you have insurance for TPD and you become totally and permanently disabled as defined in the Cbus Insurance Policy (see the definition on page 36) while a Cbus member, you can claim: the total amount in your super account, and any insurance benefit entitlement for TPD. To claim a TPD benefit, contact us on to check if you re eligible and get the forms you need to complete. This handbook doesn t explain all the conditions for making a TPD claim. It outlines the main requirements in the current Cbus Insurance Policy and Trust Deed. You have to meet these conditions to be eligible to apply for an insured TPD benefit. The Insurer will assess your claim under the definition of TPD that applies to you (see TPD definition on page 36) and other conditions in the Cbus Insurance Policy when you claim. Note: If you live overseas and need to make a TPD claim, the Insurer may ask you to return to Australia for assessment, at your own expense. Permanent incapacity benefit If you don t have TPD cover, but you meet the definitions of permanent incapacity in the SIS Act and Regulations and of Invalidity in the Income Tax Assessment Act, the Government may allow us to pay your total account balance as a permanent incapacity benefit. 28 Insurance handbook for Sole Traders

29 IP claims Are you eligible to claim an IP benefit? To be eligible to claim an IP benefit, the Insurer and Cbus must agree you meet the Total Disability or Partial Disability definition conditions in the Insurance Policy. To claim an IP benefit, contact us on to check you re eligible. We ll then send you forms to help you claim. Total disability benefit The Insurer may pay you a Total Disability benefit if you have an or Illness (if you re covered for Illness) and you: are unable to perform your occupation, and are not otherwise employed or engaged in any business activity, and are under the continuous and regular care of a Doctor and undergoing appropriate treatment, and meet all of the Insurer s claim requirements. You can t receive a Total Disability benefit until your waiting period has ended. The Total Disability benefit is: equal to the Monthly Benefit, less any Other Disability Income or Post Disability Income you receive (or are due to receive) during the month but cannot be more than 85% of your Monthly Income. See When your IP claim payments will be reduced at right for details. The Total Disability benefit will be paid as: 75/85ths directly to you and 10/85ths as a super contribution to your Cbus Sole Trader Super account. Partial disability benefit The Insurer may pay you a Partial Disability benefit if you have an or Illness (if you are covered for Illness) and you: return to work or in the Insurer s opinion are capable of returning to partial work duties after 14 consecutive days of Total Disability, and are under the continuous and regular care of a Doctor and undergoing appropriate treatment, and receive, or would in the Insurer s opinion receive, a Post Disability Income that is less than your Monthly Income, and meet all the Insurer s claim requirements. You cannot receive a Partial Disability benefit until your waiting period has ended. The Partial Disability benefit is: equal to the Monthly Benefit, less any Other Disability Income or Post- Disability Income you receive (or are due to receive) during the month but cannot be more than 85 percent of your Monthly Income. See When your IP claim payments will be reduced below for details. The Partial Disability benefit will be paid as: 75/85ths to you and 10/85ths as a super contribution to your Cbus Sole Trader Super account. When your IP claim payments will be reduced IP payments will be reduced by any Other Disability Income or, if relevant, Post Disability Income you receive (or are eligible to receive) in the same month. Other Disability Income Other Disability Income is any income (other than income from the Cbus Insurance Policy) you have received or are entitled to receive during a month for which you re being assessed for a Cbus IP benefit. This includes: any other income from an incapacity benefit under any other insurance policy, and any benefit under workers compensation, motor accident compensation or other state, federal or territory legislation, and payments by way of sick leave or any other entitlement to payment from the Employer that arises as a result of incapacity; but does not include: your income earned from investments or any lump sum benefit for TPD, trauma, or terminal illness, or any lump sum super benefit, or annual leave or long service leave, or Centrelink, social security or employer termination payments. Any Other Disability Income paid as a lump sum will be calculated as a monthly equivalent of one twenty fourth (1/24th) of the lump sum over a period of 24 months. If the lump sum (or a portion of the lump sum) can be proven to have been paid as compensation for pain and suffering, or the loss of use of a part of the body, the Insurer will not count this amount as Other Disability Income. If you receive a lump sum, common law, worker s compensation or statute payment and pain and suffering cannot be isolated from loss of earnings, the Insurer will convert one per cent (1%) of the lump sum to income for each month a disability benefit is paid. Insurance handbook for Sole Traders 29

30 14 Making an insurance claim (continued) Terminal Illness Benefit (TIB) or TPD benefit claims while you re receiving an IP benefit Post Disability Income Post Disability Income means any income (other than Benefits payable under the Cbus Insurance Policy) you may be capable of earning after your waiting period starts, during a month in which your benefit amount is being assessed. If you have, in the Insurer s opinion, suffered a Partial Disability but have not received any income, they will estimate your partial earning capacity according to the extent of your Partial Disability to enable them to calculate your benefit. Recurrent disability benefit If you return to Total Disability or Partial Disability within six months from the date benefit payments were made, the Insurer may treat this as a continuation of the original disability and no new waiting period will apply. You may then receive benefit payments for a recurrent disability for the remainder of the original benefit payment period. For the claim to be treated as recurrent, the disability must be caused by the same or a related medical condition as the previous claim. Living overseas If you re living overseas when you make an IP claim, the Insurer may ask you to return to Australia for assessment at your own expense. Once you start receiving a benefit, your claim payments will only continue for three months while you are overseas. For benefits to continue you must return to Australia. Approved rehabilitation expenses The Insurer may pay for your rehabilitation if they think it could help you get back to work. Approved Rehabilitation expenses may include the cost of a rehabilitation program, a device or treatment. Important note: You ll need to get the Insurer s written agreement to pay your rehabilitation expenses before the expense is incurred. If the Insurer doesn t agree to pay, you will be responsible for paying for these expenses. The maximum amount the Insurer would pay in connection with any single claim is the lesser of 6 times your Monthly Benefit or $60,000. Rehabilitation benefits are at the Insurer s discretion and are paid by the Insurer directly to the provider not to you as the claimant. Your IP cover stops from the date your TPD or TIB claim is accepted. However, if the Insurer agrees to pay you a TIB or TPD benefit while you re receiving an IP benefit, you ll keep getting paid until the end of your benefit period (unless you meet one of the other conditions: see When your IP payments will stop below). This means once the TIB or TPD is accepted, you can t claim an IP benefit for a new or Illness (where approved) only for the condition you are already being paid under. Annual benefit payment increases If you have a 5-year benefit period the Monthly Benefit will, at the end of each consecutive 12 month period for which a Disability Benefit is payable, increase by the lesser of, subject to the Maximum Cover Limits: the annual Consumer Price Index (CPI) percentage increase, or 5% This increase does not apply to a 2-year benefit period. Tax on IP claim payments Your IP claim payments are treated as taxable income. We ll deduct Pay-as-you-go (PAYG) Withholding Tax from your payments and send it to the Australian Taxation Office on your behalf. The part of the benefit paid into your Cbus Sole Trader Super account will be treated as a before-tax (concessional) super contribution. To find out more read How Super Is Taxed at Note: Tax information is based on current tax law, which may change at any time. We recommend you get professional tax advice. When your IP claim payments will stop Your IP claim payments will stop if: you re no longer Totally Disabled or Partially Disabled, or you die, or your benefit period ends, or you reach the maximum insurable age of 65, or you re no longer under the care of a Doctor; or you live overseas for a longer period than agreed to by the Insurer, or you don t give the Insurer the information they need to assess your claim; or you make a fraudulent claim. 30 Insurance handbook for Sole Traders

31 When we won t pay an IP benefit (exclusions) If you have only IP cover, the must have happened after the date your Cbus IP cover started or restarted. You cannot claim for anything that happened to you before your cover under Cbus started or restarted. The must also result in your Total Disability or Partial Disability within 12 months of the occurring. Regardless of the waiting period you are accepted for, the must result in Total Disability or Partial Disability within 12 months of the occurring, otherwise it will not be treated as an and no benefit will be payable (unless you are also covered for Illness). The Insurer will not consider your IP claim if it is made directly or indirectly as a result of: your occupation at the time you applied or varied your insurance cover was an Excluded Occupation and the Insurer had not previously agreed to cover you knowing your occupation, or self-inflicted harm or attempted suicide, regardless of whether you were sane or insane at the time, or normal and uncomplicated pregnancy or childbirth. For the purposes of this exclusion, the following are not considered abnormal complications of pregnancy: multiple pregnancy, threatened or actual miscarriage, participation in an IVF or similar program, discomfort commonly associated with pregnancy such as morning sickness, backache, varicose veins, ankle swelling, or bladder problems, or your participation in a criminal act, or service in the armed forces of any country other than service in the Australian Defence Forces Reserves, or active participation in, or contributing to, an act of terrorism, war or war-like operation or civil commotion, or war (whether declared or not), military activity or insurrection. The Insurer will also not make a payment on an IP claim if it would cause them to infringe any health insurance legislation. Insurance handbook for Sole Traders 31

32 15 Insurance definitions If you re not sure what some of the terms in this Handbook mean, the following section should help. You should note that some of these definitions have been simplified to help you understand the terms in the Trustee s insurance policy with TAL, however in the event of any conflict, the terms and conditions in that policy will prevail. Term Active Employment Annual Taxable Income Approved Rehabilitation Australian Recognised Trade Certificate (ARTC) Definition means an event leading to bodily Injury which is caused solely and directly by violent, accidental, external and visible means and independent of any other cause; resulted in the Total Disability or Partial Disability of the Insured Person within 12 months; and occurred on or after the date that cover started or restarted under the Cbus Income Protection Policy. means you re gainfully employed and: attending work and performing your normal duties without restriction due to Illness or Injury; or if on Employer Approved Leave (except leave caused by any Illness or Injury) you d be able to attend work and perform your normal duties without restriction due to Illness or Injury. Where an Insured Person doesn t meet the definition of Active Employment but has returned to work and performed a constant level of modified duties for a period of at least 12 months in a row, then these modified duties will be taken to be the Insured Person s new normal duties. Where this occurs, the Insured Person will be taken to have met the Active Employment requirement as from the end of that 12 month period. means: if you re an employee your gross annual salary for the last financial year, as shown on your PAYG Payment Summary, if you re self-employed your annual income for the last financial year before tax, but after business expenses were deducted. means a program, device or course of treatment certified by a Doctor or other health professional to be necessary for the rehabilitation of a person but excluding any program providing hospital treatment or general treatment within the meaning of the Private Health Insurance Act 2007 (Cth) or any other program which might cause the Policy to cease to be exempt from the Private Health Insurance Act 2007 (Cth) or Health Insurance Act 1973 (Cth) or any similar legislation in connection with health insurance. An ARTC is issued by the Department of Education, Employment and Workplace Relations and recognises the holder as having skills, knowledge and experience of an Australian tradesperson. Australian Resident means an Australian citizen or a person who is the holder of an Australian permanent visa within the meaning of Section 30 of the Migration Act 1958 or resides in Australia on a 457 Working Visa. Blindness Cardiomyopathy Chronic Lung Disease Date of Diagnosis Date of Disablement Dementia and Alzheimer s Disease Diplegia means the permanent loss of sight in both eyes, whether aided or unaided, due to Illness or Injury to the extent that visual acuity is 6/60 or less in both eyes or to the extent that the visual field is reduced to 20 degrees or less of arc, as certified by an ophthalmologist. means condition of impaired ventricular function of variable aetiology (often not determined) resulting in significant physical impairment, i.e. Class 3 on the New York Heart Association classification of cardiac impairment. means the permanent end stage respiratory failure with FEV1 test results of consistently less than one litre, requiring continuous permanent oxygen therapy. means the date on which sufficient medical evidence first exists allowing for an opinion to be formed by a treating specialist in the relevant field that the Insured Person is suffering from a Terminal Illness. Total and Permanent Disablement (TPD) is treated as having occurred on the Date of Disablement which is: a) for Part 1 or Part 2 of the TPD definition, the date on which you re diagnosed as suffering from a Specified Medical Condition, OR b) for Part 1 of the TPD definition, the date on which you were first unable to follow your usual occupation for three months in a row, OR c) for Part 2 of the TPD definition, the date on which you were first unable to perform at least two Everyday Work Activities for 12 months in a row. means the clinical diagnosis of dementia (including Alzheimer s disease) as confirmed by a consultant neurologist, psycho-geriatrician, psychiatrist or geriatrician. The diagnosis must confirm permanent irreversible failure of brain function resulting in significant cognitive impairment for which no other recognisable cause has been identified. Significant cognitive impairment means a deterioration in the person s Mini-Mental State Examination scores to 24 or less and deterioration would continue but for any effective treatment. Dementia related to alcohol, drug abuse or Acquired Immune Deficiency Syndrome is excluded. means the total loss of function of both sides of the body due to Illness or Injury, where such loss of function is permanent. 32 Insurance handbook for Sole Traders

33 Term Doctor Eligible Person Employer Approved Leave Employer Superannuation Guarantee Contribution Everyday Work Activities Excluded Occupations Hemiplegia Illness Injury Insured Person Loss of Hearing Loss of Speech Major Head Trauma Definition means a validly qualified medical practitioner registered to practice in Australia, New Zealand, the United Kingdom, the United States of America, or Canada, or as otherwise agreed between Cbus and the Insurer. That person may not be the Insured Person, the Insured Person s business partner, a member of the Insured Person s immediate family or their employer. means a person who is eligible for cover under the Insurance Policy. means leave (including unpaid leave) that s been granted by the employer in accordance with the employer s employment practices, supportable by documentary evidence. means a Superannuation Guarantee Contribution to be credited to the member s account in respect of a period of employment. means the following activities: 1. Mobility you can t do one of the following: - walk more than 200m on a level surface without stopping due to breathlessness. - bend, kneel or squat to pick something up from the floor and straighten up again, nor can you get in and out of a standard sedan car. 2. Communicating you can t do one of the following: - speak in your first language so that you re understood in a quiet room, nor can you hear (with or without a hearing aid or other aid) an instruction given in a normal voice in your first language in a quiet room. - understand a simple message in your first language, and relay that message to another person. 3. Vision you can t, with or without glasses or contact lenses, read ordinary newsprint and pass the standard eyesight test for a car license. 4. Lifting you can t lift, carry or move objects weighing 5kg using your hands. 5. Manual dexterity you can t use your hands or fingers to manipulate small objects with precision (such as picking up a coin or fastening shoelaces or buttons, using cutlery, or using a pen or keyboard to write a short note). the following occupations are excluded occupations for Income Protection cover: air traffic controller, miner, professional entertainer such as actor, dancer, musician and stage performer, fireman, police, ambulance officer and paramedic, fisherman, forestry worker, workers in the horse racing industry such as trainer, jockey and strapper, offshore oil rig worker, commercial pilot, professional and semi professional sport person, security guard, doormen, bouncer and person employed in crowd control, sheltered workshop employee, underwater worker, sex worker. means the total loss of function of one side of the body due to Illness or Injury, where such loss of function is permanent. means a sickness, disease or disorder. means bodily injury caused by violent, external and visible means. means an Eligible Person for whom insurance cover is in force. means the complete and irrecoverable loss of hearing, both natural and assisted, from both ears as a result of Illness or Injury, as certified by a specialist the Insurer considers appropriate. means the total and irrecoverable loss of the ability to produce intelligible speech as a result of permanent damage to the larynx or its nerve supply or the speech centres of the brain. The loss must be certified by an appropriate medical specialist. means Injury to the head resulting in neurological deficit causing either: a permanent loss of at least 25% whole person function (as defined by the American Medical Association publication Guide to the Evaluation of Permanent Impairment 4th Edition or an equivalent guide to the evaluation of impairment approved by the Insurer), or the permanent and irreversible inability to perform, without the assistance of another person, any two of the following activities of daily living: - dressing: the ability to put on and take off clothing - toileting: the ability to use the toilet, including getting on and off - mobility: the ability to get in and out of bed and a chair - continence: the ability to control bowel and bladder function - feeding: the ability to get food from a plate into the mouth as certified by a consultant neurologist. Insurance handbook for Sole Traders 33

34 15 Insurance definitions (continued) Term Maximum Cover Limit Monthly Benefit Monthly Income Motor Neurone Disease Multiple Sclerosis Muscular Dystrophy New Events Cover On-Time Employer Contribution Other Disability Income Paraplegia Definition means $20,000 per month. means the lesser of: the benefit amount represented by the number of units of cover that the Insured Person has under the terms of the policies; and 85% of the Insured Person s pre-disability Monthly Income; and the Maximum Cover Limit. means: (a) where the Insured Person directly or indirectly owns part or all of a business or practice in which they perform their occupation, their Monthly Income is 1/12th of the annual share of the income of that business or practice generated by their personal exertion (averaged over the 12 months immediately prior to the commencement of the Waiting Period or, if applicable, such shorter period that they have been continuously self-employed), after the deduction of their share of expenses in generating that income and before the deduction of tax, or any other income the Insurer has expressly approved; and (b) where the Insured Person does not directly or indirectly own part of their employer, their Monthly Income is 1/12th of their current annual pre-tax salary from their employer (where annual pre-tax salary is averaged over the 12 months immediately prior to the commencement of the Waiting Period or, if applicable, such shorter period that they have been continuously employed) but not including any director s fees, commissions, overtime payments, bonuses, penalty or shift allowances. Monthly Income does not include investment income, income received from deferred compensation plans, disability income policies or retirement plans or income not derived from vocational activities, unless the Insurer has expressly agreed otherwise. means unequivocal diagnosis of motor neurone disease by a consultant neurologist and confirmed by neurological investigations. means the unequivocal diagnosis of multiple sclerosis as confirmed by a consultant neurologist and characterised by demyelination in the brain and spinal cord evidenced by Magnetic Resonance Imaging or other investigations acceptable to the Insurer. There must have been more than one episode of well-defined neurological deficit with persisting neurological abnormalities. means the unequivocal diagnosis of muscular dystrophy by a consultant neurologist. means cover for claims arising from an Illness or Injury that first occurred on or after the date cover last started, restarted or increased. means an Employer Superannuation Guarantee Contribution received by Cbus within six months of the end of the month to which the Employer Superannuation Guarantee Contribution relates. means any income (other than benefits payable under the Cbus Income Protection Policy) that an Insured Person is entitled to receive during a month for which the amount of the benefit that applies to them under this policy is being assessed, whether that income was actually received or not, and includes: any other income derived as a result of incapacity under any other insurance policy, and any benefit under any workers compensation, motor accident compensation or other similar State, Federal or Territory legislation, and payments by way of sick leave or any other entitlement to payment from the Employer that arises as a result of incapacity; but does not include: income earned from investments; any lump sum total and permanent disablement benefit, lump sum super benefit, lump sum trauma or terminal illness style of benefit; annual leave or long service leave entitlement; and Centrelink, social security or employer termination payments. Any Other Disability Income that is in the form of a lump sum, or is commuted for a lump sum, has a monthly equivalent of the fraction of the lump sum that the Insurer has reasonably determined should apply with respect to the Insured Person. If it can be shown that a portion of the lump sum represents compensation for pain and suffering, or the loss of use of a part of the body, the Insurer will not take the portion into account as Other Disability Income. Where a common law, worker s compensation or statute payment is received as a lump sum and pain and suffering cannot be isolated from loss of earnings the Insurer will convert this to income on the basis of 1 percent of the lump sum for each month a disability benefit is paid. means the permanent loss of use of both legs or both arms, resulting from spinal cord Illness or Injury. 34 Insurance handbook for Sole Traders

35 Term Parkinson s Disease Partial Disability and Partially Disabled Post-Disability Income Participating Employer Partner Primary Pulmonary Hypertension Quadriplegia Regular Remuneration Work Senior Manager/ Executive Severe Burns Severe Rheumatoid Arthritis Definition means the unequivocal diagnosis of Parkinson s disease by a consultant neurologist where they confirm that the condition: Is the established cause of two or more of the following: - Muscular rigidity - Resting tremor - Bradykinesia, and Has caused significant progressive physical impairment, likely to continue progressing but for any treatment benefit. The person must be following advice and treatment of a specialist neurologist. means that you have ceased to suffer Total Disability and; have resumed employment, or in the Insurer s opinion are capable of returning to partial employment duties; and as a result of the (or where you have cover for and Illness, the or Illness) that has caused your Total Disability, you receive, or would in the Insurers opinion receive, a Post-Disability Income that is less than your Monthly Income; and you are under the continuous and regular care of a Doctor undergoing appropriate treatment; and you satisfy all of the Insurer s claim requirements. No partial disablement benefit is payable until the waiting period has been satisfactorily completed. means any income (other than the benefits payable under the policy) that you may derive from personal exertion after the commencement of the waiting period during a month for which the amount of the benefit that applies to you under the Cbus Income Protection policy is being assessed. However, if you are, in the Insurer s opinion suffering Partial Disability but have not received such income, your Post Disability Income will be the amount the Insurer considers you are capable of earning from personal exertion having regard to the extent of your Partial Disability. means an employer who makes or agrees to make contribution payments to the Fund. means a legal spouse or person living with you on a bona-fide domestic basis who may be the same gender as you. means primary pulmonary hypertension associated with right ventricular enlargement established by cardiac catheterisation resulting in significant permanent physical impairment to the degree of at least Class 3 on the New York Heart Association classification of cardiac impairment. means the permanent loss of use of both arms and both legs, resulting from spinal cord Illness or Injury. means regular work in any employment, business, profession or occupation, for reward, or the hope of reward, of any type. Senior Managers/Executives are people whose primary occupation/profession satisfies at least three of the following: They manage and have responsibility for the work of other supervisory, professional or managerial employees or manage a key business function within their organisation, They make decisions or recommendations in relation to employment of staff as well as other personnel actions (such as promotion and leave authorisation), They manage a profit centre or budget and have the authority to approve significant expenditure, They operate as a senior specialist providing expert advice to other professional employees or the organisations executive. means third degree burns to 20 per cent or more of the body surface, or to the whole of the face or the whole of both hands requiring surgical debridement and/or grafting. means the unequivocal diagnosis of severe rheumatoid arthritis by a rheumatologist. The diagnosis must be supported by and evidence all of the following criteria: At least a six-week history of severe rheumatoid arthritis which involves three or more of the following criteria: - Proximal interphalangeal joints in the hands - Metacarpophalangeal joints in the hands - Metatarsophalangeal joints in the foot, wrist, elbow, knee or ankle Simultaneous bilateral and symmetrical joint soft tissue swelling or fluid (not bony over growth alone), and Typical rheumatoid joint deformity and at least two of the following criteria: - Morning stiffness - Rheumatoid nodule - Erosions seen on x-ray imaging - The presence of either a positive rheumatoid factor or the serological markers consistent with the diagnosis of severe rheumatoid arthritis. Degenerative osteoarthritis and all other arthritis are excluded. Insurance handbook for Sole Traders 35

36 15 Insurance definitions (continued) Term Specified Medical Conditions Superannuation Guarantee Contribution Super Contribution Benefit Terminal Illness Tetraplegia Total and Permanent Disablement (TPD) Total Disability, Totally Disabled or Total Disablement Definition Blindness, Cardiomyopathy, Chronic Lung Disease, Dementia and Alzheimer s Disease, Diplegia, Hemiplegia, Loss of Hearing, Loss of Speech, Major Head Trauma, Motor Neurone Disease, Multiple Sclerosis, Muscular Dystrophy, Paraplegia, Parkinson s Disease, Primary Pulmonary Hypertension, Quadriplegia, Severe Burns, Severe Rheumatoid Arthritis or Tetraplegia. means a superannuation contribution remitted by a Participating Employer that meets the Participating Employer s obligations with respect to an Insured Person in accordance with the Superannuation Guarantee (Administration) Act means a benefit calculated as 10/85ths of the Monthly Benefit that you are eligible to receive and which is paid to your Cbus Sole Trader Super account. means a condition, which in the opinion of two Doctors approved by the Insurer (of which one must be a specialist medical practitioner practicing in an area related to the terminal illness), is likely to lead to an Insured Person s death within 24 months from the date the Insured Person was diagnosed with the Terminal Illness. means the total and permanent loss of use of both arms and both legs, together with loss of head movement, due to brain Illness or Injury or spinal cord Illness or Injury. The definition is broken down into two parts. The part of the definition that will apply to you depends on your circumstances at the Date of Disablement. To be eligible for a TPD benefit, you must be an Insured Person at your Date of Disablement under the Cbus Insurance Policy. You ll be considered as totally and permanently disabled, if: Part 1 - Unlikely to return to work This definition applies if at the Date of Disablement you re in full-time, part-time or casual employment (or on Employer Approved Leave), self-employed, or you re unemployed and have been for less than 12 months in a row. Part 2 Everyday Work Activities (EWA) This definition applies if Part 1 doesn t apply. you re unable to follow your usual occupation by reason of Illness or Injury for three months in a row (if you re suffering from one of the Specified Medical Conditions, the Insurer won t apply this waiting period), and in the opinion of the Insurer, after consideration of medical or other evidence satisfactory to them, you re considered unlikely to ever be able to engage in any Regular Remuneration Work for which you re reasonably suited, taking into account your education, training and experience up to when your claim is assessed. You suffer an Illness or Injury that: a) has prevented you from being able to perform at least two Everyday Work Activities without assistance from another adult, despite the use of appropriate aids, for at least 12 months in a row (if you re suffering from one of the Specified Medical Conditions, the Insurer won t apply this waiting period), and b) since you became ill or injured, you ve been under the regular care and attention of a Doctor for that Illness or Injury, and c) in the opinion of the Insurer, the Illness or Injury means that you re unlikely to ever again be able to perform at least two of the Everyday Work Activities without assistance from another adult, despite the use of appropriate aids, and d) in the opinion of the Insurer, the Illness or Injury means that you re unlikely to ever again engage in any Regular Remuneration Work for which you re reasonably suited, taking into account your education, training and experience up to when your claim is assessed. means that you have a disability caused by an or Illness (depending on the type of cover you have) and you: are unable to perform your occupation; and are not otherwise employed or engaged in business activity; and are under the continuous and regular care of a Doctor undergoing appropriate treatment; and satisfy all of the Insurer s claim requirements. No Total Disablement benefit is payable until the waiting period has been successfully completed. 36 Insurance handbook for Sole Traders

37 16 Manage your account online SuperSite is the easiest way to keep track of your Cbus super including your insurance. Use SuperSite to: see your account details check your insurance cover see your last statement balance see an estimated current account balance check on payments received change your investment option update your address make personal contributions using BPAY view an estimated benefit quote provide your tax file number, and check your nominated beneficiary. Call us on to register for SuperSite and get your PIN. Registered to BPAY Pty Ltd ABN Insurance handbook for Sole Traders 37

38 17 Need help to sort out your insurance? Working out how much, and what type, of cover you need can seem hard. That s where we can help. If you need advice on how to choose the right cover for you, call us on to speak to the Cbus Advice Team. If you need more detailed help, no problem we can refer you to a financial planner who can give you face-to-face advice tailored to your needs. Make insurance easy: call us today. 38 Insurance handbook for Sole Traders

39 18 Other questions about your super? We can give you information and advice over the phone on: Cbus Coordinators are in every state and territory, ready to answer your super questions They also hold information sessions in the workplace, and assist with financial planning seminars to give you direct help with your super. Call for the contact details of your local Coordinator. Choosing an investment option Insurance options Building your super Salary sacrifice Government co-contributions Transition to Retirement Super income streams Call from 8am to 8pm (AEST) Monday to Friday to speak to us. There s no charge to members for this service. We can also arrange for you to meet with a professional Financial Planner. We can refer you to professional Financial Planners who can give you comprehensive personal advice, including recommendations on: Super (including combining your super accounts) Transition to Retirement Retirement planning (including Centrelink and super income streams) Investment options (including other assets) Redundancy Tax planning Personal insurance needs. As a member, your first meeting to assess your needs is free. If you decide you need personal advice, you ll be charged on a fee-for-service basis. What you pay is agreed to in advance, so you ll know up-front how much the service will cost. Financial planners are available in all states and territories. Call today to book your first meeting. Insurance handbook for Sole Traders 39

40 Contact Cbus am to 8pm AEST/AEDT (within Australia). Open Monday to Friday, closed national public holidays Cbus Locked Bag 999 Carlton South VIC /15