Reduce your life insurance sum insured or stop the annual increase based on the Consumer Price Index (CPI)
This guide covers two topics:
- 1. Request a reduction to your life insurance sum insured
- 2. Request to stop the annual increase based on the Consumer Price Index (CPI) feature
Reducing your sum insured
Have things in your life changed since you started your policy? Your sum insured affects how much you pay in premiums. Consider your personal circumstances; if you no longer require your current level of cover, you may wish to reduce it and therefore reduce your premiums.
If you wish to increase your cover amount in the future, it will be subject to underwriting and our approval.
As an example, reducing your cover amount by 10% could also reduce your premiums by a similar amount*.
*Any reduction in premium will depend on a range of factors including your premium structure and cover amount. Based on premium rates as at 1 August 2023.
Stopping the consumer price index (CPI) increase
To help the value of your benefits keep up with the cost of living, we automatically increase the amount of certain benefits each year on your review date in line with the greater of the Consumer Price Index (CPI) or 3%. This means that each year, your cover amount may increase to keep up with inflation. And as your cover amount increases, your premiums will too.
CPI increases are optional: generally, you can choose to turn this feature off at any time (permanently or temporarily) if it’s currently applied to your policy.
Things to consider
Consider your individual circumstances and what your needs may be in the years ahead and whether your current benefit amount reflects those needs now and later.
For example, declining a 7%* automatic indexation increase could reduce your premiums by a similar amount.
*Any reduction in premium will depend on a range of factors including the type of benefit(s) you are covered for, cover amount and your premium structure. CPI means the percentage increase in the Consumer Price Index (‘weighted average of eight capital cities combined’) as published by the Australian Bureau of Statistics or its successor over the 12 month period ending 31 March each year. The CPI will apply for the subsequent year commencing 1 October. CPI as of October 2023 is 7% and is subject to change. Based on premium rates as at 1 August 2023.We recommend that you seek financial advice before deciding to remove the annual CPI increase or reduce your cover.
The form is to be completed by the Policy Owner, or the life insured (if the policy is held in Superannuation or BT Funds Management Limited is the Policy Owner).
Please mail your completed Reduction of cover and changes to CPI Form to:
GPO Box 5467
Sydney NSW 2001
or email to: btlifeinsurance@tal.com.au