How Much Does Life Insurance Cost in Australia?

Life insurance can be an important financial safety net for your family, but one of the first questions many Australians ask is simple:

How much does life insurance actually cost?

The answer is that there is no single fixed price. Life insurance premiums can vary depending on your age, health, occupation, lifestyle, smoking status, cover amount and the insurer you apply with. MoneySmart notes that insurers set life cover premiums based on factors such as age, health, job and lifestyle, and that premiums generally rise as you get older.

That is why comparing life insurance quotes can be helpful before you apply. A comparison can give you a clearer view of what cover options may be available, how premiums may differ between insurers, and whether the cover amount you are considering fits within your budget.

Start by comparing life insurance quotes with JIC Insurance.
You can compare options and see what may be available based on the details you provide.

Key points

• Life insurance premiums can vary between insurers.
• Your age, health, occupation, lifestyle, smoking status and cover amount can all affect the cost.
• Higher cover amounts generally result in higher premiums.
• Comparing quotes before applying can help you understand your available options.
• The cheapest policy may not always provide the features, definitions or structure you are looking for.

Life insurance, also known as life cover or death cover, is designed to pay a lump sum if the insured person passes away. MoneySmart explains that people who rely on your income may use this money to help pay the mortgage, clear debts and cover everyday living costs.

For many people, life insurance is considered when they have:

• a mortgage,
• a partner,
• children,
• personal debts,
• business debts,
• financial dependants, or
• a household that relies on their income.

The amount of cover a person compares can have a major impact on the premium. For example, comparing $300,000 of cover will generally produce a different premium to comparing $1 million of cover.

That is why it can be useful to work out a rough cover amount first, then compare quotes to see what that level of protection may cost.

Life insurance cost depends on the information provided during the quote and application process.

There is no universal premium that applies to every person, because insurers assess risk differently. One insurer may price a particular age, occupation or health profile differently to another. This is one of the main reasons comparison can matter.

When you compare life insurance quotes, the premium may be influenced by factors such as:

• your age,
• your gender,
• whether you smoke,
• your occupation,
• your health history,
• your family health history,
• your lifestyle,
• high-risk hobbies,
• the amount of cover selected,
• whether the policy is held personally or through superannuation,
• whether the premium structure is stepped or variable,
• optional policy features, and
• the insurer’s pricing.

MoneySmart notes that life insurers usually ask about age, job, medical history, family health history, smoking, lifestyle and high-risk hobbies or sports when assessing life cover.

Because these factors can affect both price and availability, the most practical way to understand cost is often to compare quotes based on your own details.

Life insurance premiums can vary because each insurer has its own pricing, policy definitions, underwriting rules and application requirements.

Two people may compare the same amount of cover and receive different premiums because their personal details are different. Likewise, the same person may compare the same amount of cover across multiple insurers and see different premium results.

For example, premiums may differ based on:

1. Age

Age is one of the most important pricing factors. Premiums generally become more expensive as a person gets older because the risk of claim increases over time. MoneySmart notes that premiums generally rise as you get older.

2. Smoking status

Smokers generally pay more for life insurance than non-smokers. This is because smoking can increase health risks, which can affect how insurers assess the application.

3. Occupation

Some jobs carry higher risks than others. A person working in a higher-risk occupation may receive a different premium to someone working in a lower-risk office-based role.

4. Health and medical history

Insurers may ask about current health, medical history and family health history. Depending on the information provided, an insurer may offer standard terms, apply a premium loading, exclude certain conditions, or request further information.

5. Cover amount

The higher the cover amount, the higher the premium is generally likely to be. This is because the insurer is taking on a larger potential claim amount.

6. Policy structure

Life insurance can be held personally or, in some cases, through superannuation. Premiums for cover inside super are generally deducted from the super balance, which can reduce retirement savings over time.

Not necessarily.

Price is important, but it is not the only factor to compare. A lower premium may look attractive, but it is also worth looking at what the policy includes, what it excludes, how the insurer assesses claims, and how premiums may change over time.

When comparing life insurance, it may be useful to look at:

• the monthly or annual premium,
• the amount of cover,
• policy definitions,
• exclusions,
• premium structure,
• whether cover is inside or outside super,
• claim requirements,
• whether other covers are packaged with the policy, and
• whether the policy fits the purpose you are comparing it for.

MoneySmart also provides a life insurance claims comparison tool that allows consumers to compare claim acceptance rates, claim times and claim disputes across insurers where enough data is available.

A comparison is not just about finding a cheap premium. It is about understanding the options available before deciding whether to apply.

The amount of cover you compare may depend on what you want the policy to help with.

Common items people think about include:

• paying out a mortgage,
• clearing personal debts,
• replacing income for a period of time,
• helping with children’s education costs,
• providing support for a partner,
• covering funeral costs,
• protecting business debts, and
• giving family members time to adjust financially.

A simple way to think about cover is to compare the financial obligations your family may have against the savings, superannuation, assets or other resources that may already be available.

For example, someone may consider:

Mortgage + debts + future family expenses – existing savings and assets = possible cover amount to compare

This is not a personal calculation or recommendation, but it can be a useful starting point before comparing quotes.

You can also read our related guide:
How Much Life Insurance Cover Should I Compare?

Comparing quotes before applying can help you avoid guessing.

Rather than assuming life insurance is too expensive, too complicated, or not available, a comparison can help you see what options may exist based on your details.

A life insurance comparison may help you understand:

• how much different cover amounts may cost,
• how premiums vary between insurers,
• whether monthly premiums fit within your budget,
• whether personal or superannuation ownership may be available,
• whether additional covers such as TPD, trauma or income protection may also be relevant to compare, and
• whether you want to continue with an application.

This is where JIC Insurance can help.

Our comparison process is designed to make it easier to compare life insurance options without needing to contact multiple insurers yourself.

Compare life insurance quotes with JIC Insurance

See what options may be available and decide whether you want to continue.

To compare life insurance quotes, you may be asked for information such as:

• your age,
• gender,
• smoking status,
• occupation,
• income,
• general health details,
• cover amount,
• whether you want cover inside or outside super,
• whether you want life cover only or other cover types included.

If you continue from quote stage to application stage, the insurer may ask more detailed questions. MoneySmart notes that the information provided helps an insurer decide whether they will insure a person, how much the premiums will be, and what terms and conditions may apply.

It is important that information provided to an insurer is accurate. If important details are left out, it may affect the policy or a future claim.

In many cases, life insurance can be held through superannuation. MoneySmart notes that most super funds offer insurance through super, including life cover, TPD and income protection.

Holding cover through super may make premiums easier to manage from a cashflow perspective because premiums are generally deducted from the super balance rather than paid directly from a bank account. However, this also means premiums reduce retirement savings over time.

When comparing life insurance, it may be worth checking:

• whether you already have cover through super,
• how much cover you have,
• what the premium is,
• when the cover ends,
• whether the definitions suit the purpose of the cover,
• whether the cover amount is enough, and
• whether you are paying for duplicate cover across multiple super funds.

Comparing life insurance quotes can help you understand how cover outside super may compare with cover held through super.

After comparing quotes, you can decide whether you want to continue.

The general process may look like this:

1. Compare quotes
   Enter your details and compare available options.
2. Review the options
   Look at premium, cover amount, ownership structure and key policy details.
3. Choose whether to apply
   If an option appears worth exploring, you can continue to the application stage.
4. Complete insurer questions
   The insurer may ask about health, occupation, lifestyle and other details.
5. Insurer assessment
   The insurer assesses the application and confirms whether cover can be offered, and on what terms.
6. Policy decision
   You can then decide whether to proceed with the cover offered.

Compare life insurance quotes with JIC Insurance

Life insurance cost can vary significantly depending on your personal details, cover amount and insurer.

That is why comparing quotes can be a useful first step.

With JIC Insurance, you can compare life insurance options in a simple, professional process designed to help you understand what may be available before you apply.

General information disclaimer

This article contains general information only and does not take into account your objectives, financial situation or needs. MoneySmart explains that personal financial advice is tailored to a person’s circumstances, while general financial advice or information does not consider personal circumstances in the same way. Before making a decision, consider whether the information is appropriate for you and read the relevant Product Disclosure Statement.