Life insurance is what keeps your family’s finances secure if you die or are diagnosed with a terminal illness. Life cover pays out a lump sum to your nominated beneficiaries that can be used however it is needed, which allows your family to maintain their lifestyle without suffering financially. At a time when your loved ones are grieving, not having to worry about money can make a big difference.
What types of life insurance are there?
Term life insurance/Life Cover: A lump sum payment that goes to your
beneficiaries if you pass away or are diagnosed with a terminal illness.
Trauma Cover: If you are diagnosed with a major medical illness or suffer an injury, trauma cover provides a lump sum that can cover your short-term expenses while you’re in treatment and recovery.
Total and Permanent Disability (TPD) Cover: If you become totally and permanently disabled and are no longer able to work, TPD insurance provides a lump sum payment.
Income Protection: If you are unable to work due to an injury or illness, income protection cover provides a monthly payment for a fixed period.
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Before he came to us, Frank was paying for three separate insurance policies that were costing him over $10,000 a year. He was frustrated and disappointed with his insurers but didn’t know where to start.
With the help from one of our Senior Advisers he was able to amalgamate his policies into one comprehensive plan. With a new yearly premium of $6,000, and an insurer that has paid out over $2 billion in claims to Australians over the past two years Frank’s family was better protected and he was paying less.
Frank has since returned to us and we’re helping him with his Income Protection claim. As he recovers from knee surgery this money will help him support his family while he’s unable to work.
After years of paying premiums to the same insurer Maggie found herself in trouble when they suddenly refused to renew her policy. Due to a change in her health and her finances, she was told that no insurers would protect her. That’s when she came to us.
Our advisers were not only able to get Maggie the peace of mind that an underwritten life insurance policy brings; they also helped her save a few thousand dollars on her yearly premium. She was even able to save on her out of pocket expenses by opting to fund the new premium through her SMSF (self-managed super fund).
Maggie is now in the process of upping her cover to include a Trauma Insurance benefit with the help of one of our Senior Advisers.
With our help she’s making the journey from uninsurable to fully protected.
The amount of life cover you need depends on your personal circumstances. Here are some factors to consider:
Existing debt: Your outstanding debts will likely fall to your family, so your life insurance should be enough to pay them off. This might include a mortgage, car loan, or credit cards.
Living expenses: Take stock of your regular bills, which will keep coming even if you pass away and your income is no longer there. This includes utilities, rent, grocery bills, and school fees.
Age of family members: How many children do you have and how old are they? This can help you determine the kinds of expenses that are likely to come up.
Family assets: How much money could your family access if needed? This includes cash savings, property that can be sold, and shares.
Life insurance works in a similar way to other types of insurance. You pay a monthly or annual premium to get financial protection for an asset, which in this case is you. If you pass away or you are diagnosed with a terminal illness, your nominated beneficiaries will receive a payout. The money can be used wherever it is needed, which is typically for things like mortgage payments, day-to-day living expenses, education, or childcare. The amount provided varies depending on the terms of the insurance policy, and once the payout is complete, the policy effectively ends.
An online life insurance purchase can offer a more comprehensive look at the market than life insurance direct from a single insurer. Compare today with LifeInsuranceComparison.com.au and know you’re making an informed decision on your life cover. You’ll even get professional advice from a life insurance broker, who will handle the paperwork and liaise with the insurer on your behalf.
Life insurance cost varies but can be surprisingly affordable. Recent comparisons show that a 5-star rated policy with 500,000 of cover for a female non-smoker in her 40s costs an average of $9.81 per week. The same policy for a male non-smoker in his 40s costs an average of $11.40 per week.*
The whole of life insurance premium depends on several factors, such as your age, lifestyle, health, and what job you do. All of these things contribute to your risk rating, which is what determines your premium. For example, life insurance for diabetics has different considerations than life insurance for non-diabetics. Many policies will require a medical exam as part of the risk assessment process, though no medical life insurance is also possible. Compare life insurance quotes online with LifeInsuranceComparison.com.au to find a low price on a policy that offers the cover you want.
*Figures from CANSTAR 2017 Direct Life Insurance Star Ratings and Awards
The best life insurance for your neighbour may not be the best life insurance for your family. The best life cover will tick the boxes for you on features, budget, and flexibility. Life insurance benefits cover a wide range of options and budgets so you can better find a policy that suits you.
Here are some features to consider when choosing the best life insurance policy:
Family Benefits: Lump sum of up to $20,000 if one of your dependent children is diagnosed with a terminal illness or passes away.
Premium Freeze: Flexible option to keep your premium the same each year by reducing the sum insured
Financial Planning Benefit: Up to $3,000 back to cover financial advice obtained in regards to managing your claims payment
Insure for the Future: Increase your amount insured without providing further medical evidence when you experience a major life event
Multi-life discount: 10% discount on the second life insurance policy when two applications are submitted simultaneously.
Round-the-clock worldwide cover
Cash advance benefit: An advance payment of $15,000 while the claim is being settled to help with funeral expenses.
Flexible cover: Lump sum cover amounts range from $50,000 to $1.5 million
Life insurance cost is one of the most important factors for many people when buying life cover. Finding cheap life insurance that delivers on value is a priority for Australians, and the good news is that it’s within your reach.
Recent comparison quotes show that a 30-year-old non-smoking female office worker can get $500,000 of life cover for as little as $18.42 per month. Premiums increase slightly with age; the same insurance can be found for a 40-year-old at $23.65 per month, or for a 50-year-old at $58.27 per month.
There are a few other tips that can help you find cheap life insurance:
Review your policy regularly. Major life events like having a baby or buying a house can affect the amount of cover you need.
Understand the cover you have. It’s possible you already have some level of cover through your superannuation, so you could save by consolidating cover.
Live a healthy lifestyle. Smoking can drive up the cost of your policy, as can drinking alcohol or having some medical conditions.
Take advantage of discounts. Insurers may offer discounts for holding multiple policies or for paying premiums in advance.
Shop around. Compare life insurance quotes online with LifeInsuranceComparison.com.au to find a low-cost policy
The benefits of life insurance depend on where you’re at in life. What you need out of life cover at age 25 might look very different from what you need at age 55. It’s so important to review your life cover regularly to make sure continues to give you value for money.
Young single: Consider income protection insurance, which would supplement your income if you were unable to work due to illness or injury.
Young couple: It’s not just you anymore! If you and your partner have taken on any debts, life cover means that your spouse will not be hit with the bills if you were to pass away.
Starting a family: When children enter the picture, life cover becomes even more important. It provides the financial cushion to help your young family maintain its lifestyle, so your spouse doesn’t have to bear the burden on a single income.
School-aged children: As your family grows, new expenses arise, such as education or investment opportunities. If one parent passes away, child care expenses may also become part of the family budget.
Children leaving home: When your adult children leave home your financial commitments may reduce, so it’s a good time to reassess your life cover needs, especially in the run-up to retirement.
Retirement: At this stage, life insurance can give you peace of mind that the money you’ve saved over the years is safe. It can also cover any unforeseen medical or funeral expenses as well as outstanding debt, so those don’t fall on your family.