Most professionals think they have income protection sorted. Most are wrong - and the gap only becomes obvious when it's too late to fix it.

For high-income earners in Australia, the income protection insurance held inside superannuation is almost never adequate. It typically covers only a fraction of your actual income, has short benefit periods, and may not cover the way you actually earn. If your household depends on your income - and at $250k+ it almost certainly does - this deserves proper review by a licensed adviser, not a set-and-forget approach.

THE FALSE SENSE OF SECURITY MOST PROFESSIONALS HAVE

Here's something I see regularly: a professional earning $200,000 a year tells me they have income protection through their super fund. They feel covered. Then we look at the actual policy.

The default coverage through super is typically 75% of a salary figure - but that figure is often based on your salary at the time of joining the fund, not your current income. It may have a benefit period of two years. There's often a waiting period of 90 days before payments begin. And the definition of "disability" may require you to be unable to work in any occupation, not just your own.

For someone earning $200,000, a two-year benefit period with reduced coverage is a very different safety net than they assumed. What happens in year three if they're still unable to work?

WHAT INCOME PROTECTION SHOULD ACTUALLY DO

Good income protection insurance for a high-income earner should do the following:

- Replace up to 70% of your actual current income - not an outdated figure

- Pay until age 65 if you can't return to work - not just for two or five years

- Use an "own occupation" definition of disability - meaning you're covered if you can't do your specific job, not just any job

- Have a waiting period you can actually afford - 30 or 60 days if you don't have significant cash reserves; 90 days if you do

- Be held outside super where possible - so the premiums are tax-deductible and the payout isn't subject to super access rules

WHY SUPER-BASED COVERAGE OFTEN FALLS SHORT FOR HIGH EARNERS

Super funds provide group income protection as a default. It's better than nothing. But group policies are designed for the average member of the fund - not for a professional on $200,000+ who has a mortgage, school fees, and a financial life that depends heavily on their income continuing.

The further you are from "average", the less default cover serves you. A 42-year-old surgeon, a partner at an accounting firm, or a senior executive with a complex compensation structure - these people need coverage that reflects their actual situation.

Income protection isn't about being pessimistic. It's about making sure the financial plan you've built doesn't collapse the moment something goes wrong.

WHAT A PROPER REVIEW ACTUALLY INVOLVES

A proper insurance review isn't a five-minute online form. It involves looking at your actual earnings, your existing coverage across all policies (super and outside), your debt position, your family's monthly outgoings, and what a genuine worst-case scenario would look like for your household. Then it involves designing coverage that closes the real gaps - not just adding another policy on top of what you have.

Most of the people I work with have never had this conversation properly. It usually only takes one meeting. And the cost of getting it wrong is, frankly, enormous compared to the cost of fixing it.

Not sure if your current coverage is actually enough?

I do a complimentary insurance review as part of every initial strategy call. We look at what you have, what the real gaps are, and what it would take to close them properly.