Life Insurance with Money Matchmaker®

Life Insurance

Written by

Shaun McGowan

Life offers few certainties, but the inevitable passing of a family member will always be an emotionally and financially complicated time for those who remain.

A life insurance policy can provide financial certainty and comfort during this difficult time, through a one-off lump sum payment that can be used to support your family financially if you pass away.

In the sections below, you’ll find detailed overviews of the most common types of life insurance available and beginner’s guides that cover the essentials of life insurance in Australia.

Whole Term Life Insurance

Whole term life insurance, or death cover, is a standard life insurance policy and the most common type of life insurance most people will have heard of. 

This general cover pays a lump sum amount to beneficiaries in the event of your passing or being diagnosed with a terminal illness.

Beneficiaries are generally family members, such as a spouse or your children. However, life insurance policies can also include business associates as beneficiaries in some cases.

Find out more about Whole Term Life Insurance with Money Matchmaker

Completely new to life insurance and don’t know where to begin?

Read our Life Insurance Starter Guide.

Common Types of Life Insurance

When selecting a life insurance policy, you’ll choose the types of coverage you’d like to include. While there’s a life insurance policy for everyone, it’s not a one-size-fits-all deal.

The three most common types of life insurance included with a policy:

You can read an in-depth overview of these common life insurance coverage types below to help you decide on the right type of coverage for you.

Trauma insurance

Pays out a lump sum when you suffer a traumatic injury or illness such as cancer or a serious head injury.

Find out more
Trauma insurance with Money Matchmaker

Total and permanent disability insurance

Pays out a lump sum when you suffer an injury or illness that leaves you totally and permanently disabled.

May also include cover for partial disablement such as loss of sight or limb.

Find out more
Total and permanent disability insurance with Money Matchmaker

Income protection insurance

Pays out regular benefits for a set period if you lose your income due to injury or illness.

Find out more
Income protection insurance with Money Matchmaker

Life Insurance Guides

Our life insurance guides below are an approachable series of knowledge articles to help provide an overview of life insurance in Australia.

If you’re completely new to life insurance, begin with our Life Insurance Starter Guide.

Life Insurance Starter Guide

On this page:

  • Life insurance basics
  • What does life insurance cover?
  • Do you need life insurance?
  • Benefits of life insurance
  • How to choose the right cover

Read more

Types of Life Insurance

On this page:

  • Life insurance policy types
  • Whole term life insurance
  • Life insurance policy add-ons
  • The difference between trauma insurance and TPD

Read more

Choosing a Life Insurance Policy

On this page:

  • Before you apply
  • How much cover to choose
  • Life insurance premiums
  • Comparing life insurance policies
  • Life insurance for seniors

Read more

How to Get Life Insurance

On this page:

  • Life insurance eligibility
  • Where to buy life insurance
  • Life insurance and superannuation
  • The cost of life insurance
  • Free Life Insurance Quote

Read more

Funeral and Care Cover

Life insurance for seniors is often about protecting yourself as much as your family if the unexpected happens. In Australia, funeral cover and care cover are commonly included in life insurance policies for senior citizens.

The older we get, the more people we have depending on us, and life insurance payouts can remove the financial strain of funeral expenses or the cost of ongoing care.

It’s important that you get equal value from your life insurance policy before you pass, and this doesn’t always mean the lowest premiums.

Asking for advice from a broker and getting a personalised life insurance quote can help you decide if a policy is suitable, and whether the price is relative to the policy and the payout.

Your Top Life Insurance Questions Answered

Do I need life insurance?

Life insurance isn’t for everyone. To figure out whether or not you need to purchase a policy think about:

  • Whether your family depends on your income and if they’d be able to continue to live comfortably after you’re gone.
  • What debt repayments and financial obligations do you have? 
  • Whether you can afford the premiums. 

What type of cover do I need?

When deciding what level of cover you need, think about what expenses your family may have when you’re gone, and how much they’ll need to continue maintaining their current lifestyle. 

A common rule of thumb is that 10 times your annual salary is a good level of cover, but each of us is unique and you may need more or less. Compare quotes before applying to find a suitable policy at a suitable price.

How much does life insurance cost?

The cost of life insurance depends on many factors like your age, gender and health. The type of policy and benefit amount you choose will also affect the cost of your premiums.

If you need a hand comparing policies and choosing the right one it may be a good idea to speak to a financial advisor or insurance broker for expert advice.

You can also buy insurance directly from the insurer or through your superannuation fund.

When should I get life insurance?

You should always purchase life insurance before you need it.

That means if you’ve got dependents, debt and other financial obligations, you may want to buy a policy young so that you’re covered no matter what happens.

As your health and age also affect the cost of life insurance premiums, if you purchase a policy at a young age you may also pay lower premiums when you’re older.

How to make a life insurance claim

Contact your insurance provider, whether that’s an insurance company, a broker or your superannuation provider. 

Have your policy number ready, ask how the claims process works and request any forms you need to fill out. 

You may need to provide supporting documentation to go along with your claim including

  • Medical reports from a doctor, listing the cause of death.
  • Your doctor’s contact details.
  • A death certificate.

Your insurer may contact your doctor to verify the cause of death before paying out the claim. 

How long does it take to process a life insurance claim?

Life insurance payments can take up to six months to be processed.

If you’re in urgent financial need you can contact your insurer to speed up the claim or request a partial advance payment.

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About the Author

Shaun McGowan from money.com.au

Shaun

McGowan

Shaun McGowan

Shaun is the founder of Money.com.au and is determined to help people pay as little as possible for financial products. Through education and building world class technology. Previously Shaun co-founded CarLoans.com.au and Lend.

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