How much does life insurance cost in Australia?
May 26, 2022

How much does life insurance cost in Australia?

Life insurance provides financial security, and there are various forms of coverage that can be customised based on your age, situation, or way of life.

You will be required to pay a premium, often known as a monthly or annual payment, when you choose a life insurance policy that best meets the needs of you and your family. Your premium will be the main expense incurred when purchasing life insurance, and the amount you pay in premiums may vary depending on a variety of criteria.

How are the costs for life insurance determined?

The type and amount of life insurance you choose will affect the premiums you pay, as different levels and terms of coverage carry a range of costs. Your lifestyle and general health will also be an essential part of choosing the right policy.

A lot of questions about your lifestyle will be asked of you when you apply for life insurance, which often consist of:

  • Personal or way of life enquiries, such as when you were born, your gender, and whether you smoke
  • About pre-existing conditions and medical queries
  • Questions about employment include what you do for a living and what you like to do in your leisure time

How much coverage do I need for life insurance?

Working through what may appear to be a difficult question is one method of determining how much cover you will require. How much money would your loved ones need to live comfortably if you were to pass away unexpectedly?

To answer this question can be challenging. You need to take into account any debts you could have, such as your mortgage, as well as any related utility, grocery, or educational expenses that would need to be paid. Consider the additional funds your family would receive in this situation, such as earnings from the sale of your investments, superannuation, and individual savings.

You may opt for one of the following four types of life insurance:

  1. Life Insurance(in case of death). If you pass away, your loved ones could receive a lump sum benefit from this kind of policy.
  2. Total Permanent Disability (TPD) insurance. In the event that you experience a total and permanent disability that prevents you from working, TPD policies offer a lump sum payment.
  3. Critical illness or trauma insurance. This coverage is a good option if you are found to have a serious illness of a particular severity as described in the applicable PDS. Frequently, the money is used to cover recuperation, rehab, and other medical costs.
  4. Income protection insurance. In the event that a serious illness or injury prevents you from working, this sort of insurance normally provides a monthly payment to make up for your lost wages.

Your personal and professional circumstances, as well as the benefits you receive from your current superannuation arrangement, will determine the types of policies you decide to invest in.

How can I get life insurance for less?

Many strategies exist for lowering life insurance prices. Some are based on how and when you initially select your policy, while others are related to your way of life.

  • Always compare policies to be sure you’re obtaining the one that best fits your needs, and carefully consider the extras and add-ons you want (and the ones that don’t apply to you). Make sure you are clear on the amount of premiums you must pay and when you must pay them by reading the terms and conditions of your insurance.
  • Consider quitting smoking or drinking, and generally strive to live a healthy lifestyle to lower your insurance premiums. For example, adopt a good diet and exercise routine to maintain a healthy blood pressure.
  • Finally, you might consider the duration of your coverage. Try to choose coverage that will fit you over the long term or that can be readily adjusted to accommodate your changing circumstances. Typically, the longer the term, the lower the price.

Many factors, including reviews and changing market conditions, may affect premiums. A reminder concerning your premiums will be sent to you before each policy anniversary for you to review and assess.

The team at WealthSmart can provide expert specialist advice no matter what your age or stage of life. We also take into account your financial situation and make recommendations based on the best outcome for your financial future. Talk to our team today or you can find more information on Life Insurance via our website.

General advice warning. This advice does not take into account your objectives, financial situation or needs. Before acting on any information, you should consider the appropriateness of the information provided and the nature of the relevant financial product having regard to your objectives, financial situation and needs. Should you require any help please contact Wealth Smart on 1800 765 100.