Life Insurance In The Australian Market

The growth of life insurance in Australia

Life insurance in Australia is officially more than 180 years old. The first policy was sold by Asteron, then known as Alliance Assurance, and countless others have followed since. Today there are more than 20 active providers in Australia’s life insurance marketplace, edging each other out with competitive pricing, discounts and additional benefits. This can make finding the right policy difficult, but it’s a lot easier when you can compare the top providers in one place and find insurance advisers just a click away.

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How big is Australia’s life insurance marketplace?

It has its ups and downs, but Australia’s life insurance market is growing as more people realise the benefits of being insured, and the potential costs of not being insured.

Who are Australia’s life insurance brands?

Since selling Australia’s first life insurance policy, Asteron has been joined by dozens of other providers with different products and focuses.

Considerations when assessing the market

Some key things to consider when assessing Australian brands in the life insurance market:

  • The scope of the brand. Some insurers are big brands with thousands or even millions of customers around the world, while others are smaller, more specialised and only exist in Australia.
  • The types of products offered. Some providers only offer certain types of insurance while others are general insurance companies with many products. Others still are banks, investment companies and even diversified grocery stores.
BrandType of brandKey featuresApply
AAMIGeneral insurance companyEasy to adjust later on, strong customer service recordGet a quote
AIAInternational health insurance specialistSuperannuation options, many available policiesGet a quote
AMPFinancial services provider and insurerStrong investment focus, highly tailored plansGet a quote
Asteron LifeFinancial planning services and life insuranceExpert advice, policies to fit long-term financial plansGet a quote
Aussie InsuranceAustralian lender and insurerCompetitive prices and widely varied productsGet a quote
AustralianSuperSuperannuation fundOnly available to  existing fundholders, superannuation rolloverGet a quote
AvantMedical professionals’ associationLife insurance policies are tailored to medical professionals onlyGet a quote
BTWestpac-owned financial services providerEasily upgradeable policies, integrated financial planningGet a quote
Bank of QueenslandHolistic financial services company, Australia-wideCompetitive prices and accessible policiesGet a quote
BankwestFinancial services, Perth-based but Australia-wideFlexible policy options, no medical tests requiredGet a quote
Bendigo BankHolistic financial services company, Australia-wideClearly tiered policies, affordable cover for childrenGet a quote
Budget DirectGeneral insurance providerCompetitive prices by focusing on low-risk customersGet a quote
BupaInternational healthcare providerWide variety of plans and optionsGet a quote
CGUFinancial products and services providerCompetitive prices through tailored policiesGet a quote
CitibankLarge worldwide financial services providerMany options, including quick policies that require no medical testsGet a quote
CommInsureCommonwealth Bank insurance divisionExtra benefits for financial planning, varied policiesGet a quote
GIOSuncorp-owned general insurance providerTailored policies, no medical tests, expanded cover optionsGet a quote
GuardianDedicated life insurance providerUp to $1.5 million sum insured, no medical or blood testsGet a quote
HSBCGlobal financial services companyPolicy flexibility, many options availableGet a quote
InsuranceLineIncome, life and funeral insurance specialistsLow entry requirements with basic policies, periodic discountsGet a quote
MacquarieHolistic financial services providerPolicies that pay benefits based on the impact of an injury or illness rather than its categorisationGet a quote
MedibankHealthcare and health insurance providerVaried options, including policies that require no medical or blood testsGet a quote
MLCInvestment and financial services providerPolicies include superannuation rollover options, flexible premium optionsGet a quote
NABBanking and financial services providerAccess to a very wide network of doctors and hospitalsGet a quote
nibHealthcare and insurance providerExtra benefits for nib membersGet a quote
OnePathInsurance provider with a focus on life coverExtra cover while travelling, guaranteed renewabilityGet a quote
QSuperQueensland-based superannuation fundNon-profit organisation, life cover integrated in superannuationGet a quote
REST Industry SuperAustralian superannuation specialistSuperannuation rollover options, sum insured that increases with ageGet a quote
Real InsuranceGeneral insurance providerSeparate family cover, flexible premium options, competitive pricesGet a quote
Virgin MoneyFinancial services providerFlexibly tailored policies, options for with or without medical testsGet a quote
WoolworthsSupermarket, financial services and moreMaximum sum insured increases with age, no medical tests requiredGet a quote
ZurichFinancial services with a focus on investment and insuranceDeath benefits can be increased annually without reassessment, up to $1.5 million sum insuredGet a quote

Considerations when looking at brands on the market

Many Australians are underinsured, meaning they don’t have enough cover to protect their loved ones in circumstances such as an unforeseen death. Sometimes this is because the sum insured is too low, other times it’s because their policy isn’t comprehensive enough to cover their specific circumstances e.g. a specific occupation. With all policies, you will need to consider:

  • Sum insured. This is how big your benefit payments are. Some policies will automatically determine this based on your typical income, while others let you select your own amount. If it’s too high you’re paying more for cover you don’t need, and if it’s too low you are not sufficiently protected.
  • Benefit requirements. Different policies may have different requirements for claiming benefits. For example, one policy might require you to be more than 15% disabled before paying benefits while another might have a 20% disability threshold.
  • Exclusions. These are situations where the policy will not pay out. All life insurance excludes suicide and self-inflicted harm for the first 13 months, while others might exclude injuries sustained in the course of certain jobs or pastimes,  illnesses tied to pre-existing health conditions or anything else the insurer determines to be an excessively high risk.

Life Insurance Options for Australians

Term life insurance

Term life insurance is sometimes called death only cover because it pays your loved ones a lump sum payment when you die. The money can then be used to pay for any final expenses your family might have upon your death, such as funeral and medical expenses, mortgages, and death. It will help them with the emotional transition without worrying too much about the finances. Aside from this, other popular insurance products available to Australians are income protection, trauma insurance, and TPD insurance.

Income protection

If you’re temporarily unable to work on account of injury or illness, income protection insurance pays 75% of your monthly gross income until you can return to work or the policy expires.

Important considerations

You'll need to choose:

  • waiting period. This typically ranges from as little as 14 days up to a full year, and is how long you have to wait before being able to claim benefits. For example, if you choose a six-month waiting period, you’d have to be unable to work for six months before you can start claiming income protection benefit payments. Choosing a shorter waiting period will typically lower your premiums.
  • benefit period.This is the maximum length of time you can claim benefits for. The shortest option may be a few weeks, while the longest can be years. A two-year benefit period, for example, means that you can get income protection payments when you are unable to work for up to two years maximum. Selecting longer benefit periods will also raise your premiums.

TPD insurance

Total and permanent disability insurance, or TPD, pays a lump-sum benefit if you become totally and permanently disabled from injury or illness.

Important considerations

  • Disability is determined by whether you are able to work and whether you are able to perform essential daily tasks without assistance, like shopping, cleaning and cooking. The daily tasks may vary between insurers.
  • When determining your ability to work, many policies will let you choose between “any occupation” and “own occupation”. This refers to whether you are permanently unable to work any job, or whether you are only unable to keep working your existing job. For example, a surgeon who loses a hand might qualify for TPD under “own occupation” because they are no longer able to keep practising surgery, but might not qualify under “any occupation” because there are other viable jobs they could be doing with only one hand. Expect higher premiums if selecting “any occupation”.

Trauma insurance

Trauma insurance pays out upon diagnosis of a critical illness, if you suffer a critical injury or undergo certain medical procedures. This option does not pay for fatal conditions – only core life insurance does. A waiting period of two weeks usually applies to ensure that you survive the event.

Important considerations

  • Listed conditions, the ones that are covered by trauma insurance, are outlined in the trauma insurance product disclosure statement (PDS). It will only pay benefits in the event of something on that list. There are typically 30 to 50 conditions covered, and most are the same across policies. Expect a combination of illnesses like cancer, injuries like lost limbs and medical events like undergoing heart surgery.
  • Partial benefits is a standard trauma insurance feature. Certain conditions, such as the loss of a single limb or blindness in one eye, will typically only pay partial benefits, such as 25–50% of the sum insured. Generally you can make multiple claims up to a total of 100%, whether in the form of several partial claims or one full claim. Some policies will give you “extension” or “top-up” options to replace used trauma insurance benefits.

What to know about Australian superannuation and life insurance

Superannuation is compulsory for all employees working in Australia. It often comes bundled with life insurance, so this should be taken into consideration when looking at policies.

If you haven’t already, you should check whether your superannuation fund already includes life insurance. You might already have a life insurance policy you didn’t know about, or you might discover a great option to consider alongside other policies.

If you’re thinking of getting life insurance through superannuation, watch out for both the benefits and the downsides.


  • Often more cost-effective than getting an equivalent policy elsewhere.
  • You are often able to select a minimal level of cover for essential protection, even if money is tight.
  • Premiums are automatically deducted and can be paid for with super contributions, making the policy easy to manage and maintain.


  • Certain policies may not be as good as what you can get elsewhere, and you might not have all the options you want.
  • Getting life insurance through superannuation is only possible if you’re a member of that super fund. Switching super funds carries its own costs and might not always be worth it, even for a better life insurance policy.
  • If you move to a different super fund, your circumstances change or the super contributions stop then your cover may end without notice.
  • There are different tax implications with superannuation life insurance. You may need to consult an adviser for more information on how these affect you personally.
  • Benefits are often slower to be paid. The insurer pays benefits to the superannuation fund, who then in turn pays out to your beneficiaries. This extra step slows things down.
  • Coverage period typically ends sooner. Life insurance cover through superannuation typically ends around age 60–70. Finding standalone policies outside of super funds lets you find options that last longer.
  • It will reduce your super balance. If getting a life insurance policy through superannuation, your premiums will be paid by the balance of your super fund. In other words, you’re paying for insurance with your retirement funds instead of money out of pocket.

Even if you decide not to get a life insurance policy through superannuation, it’s important to at least check your fund to see what kind of insurance is available, if any, and to confirm whether or not you’re already paying for life insurance without knowing it.

Advisers or direct life insurance: which is right for you?

You can find and compare policies either by looking at direct brands, which are insurers that advertise and sell directly to policyholders, or by going through an insurance broker or adviser. Depending on your situation, you may find one more preferable than the other.

Consider going direct if:

  • You know exactly what you want in a policy. Life, trauma, TPD and income protection components are all very different.
  • You have the time and motivation to compare as many policies as possible.
  • You know about all your existing insurance, including workers compensation and any policies held through superannuation funds. An ideal life insurance policy will fill in the gaps as required without overlap. For example, the right option for you might be to cancel a superannuation insurance policy and replace it with a complete new policy, while someone else is better off buying cover for TPD and trauma only while keeping income protection and life cover through superannuation.

Consider an advised policy if:

  • You are considering a life insurance policy that’s geared towards investment or specifically want something to be bundled with superannuation. Depending on your circumstances, beneficiaries and what kind of insurance policy it is, there may be different tax implications.
  • You want additional protection for your partner or children. Many policies will cover them as well, but this may not always be the ideal way to protect them.
  • You are having difficulties understanding or comparing different policies. Life insurance is an important purchase but only brings real protection and peace of mind if you know it’s done right. An insurance broker can walk you through policies, answer all your questions, explain anything you’re unsure of and make sure you know exactly what you’re buying.
  • You have pre-existing medical conditions or a particularly dangerous job. Insurers will often consider these on a case by case basis, and may charge more or completely exclude benefits payable for these. Getting adequate protection for pre-existing conditions or hazardous pastimes, without breaking the bank, might require the help of an expert.
  • You are self-employed, or a part-time or casual employee. This has particularly big implications for income protection and TPD policies, will make you ineligible for certain policies and can result in higher prices elsewhere.
  • You want claims help. If you’re seriously ill or injured then the last thing you want to do is put together a claims form and all the documentation. Similarly, a grieving family usually isn’t in the best position to negotiate with an insurance company. Insurance brokers can also liaise with insurers, lodge claims for you and follow up on them on your behalf.

The benefits of having life insurance

Life insurance is something you hope you’ll never use, designed specifically to protect against the unexpected. Naturally this makes it difficult to plan for a “return on investment”. Every year, however, tens of thousands of Australians claim billions of dollars on life, trauma, TPD and income protection insurance policies, despite hoping they’d never have to. When considering the benefits of having a policy, think in real terms of what it actually means for you and your family rather than only as numbers on paper.

  • Get the power of choice. Having financial back-up in the event of an emergency means you can look at more treatment options and different specialists. Reducing the urgency and financial stress of these situations lets you spend more time on treatment and better plan for recovery without breaking the bank.
  • Adjust to new circumstances. Adjustments can be expensive, particularly if they involve something like fitting a wheelchair ramp to your front porch or hiring someone to provide around-the-clock care. In the event of injury or illness you might find yourself deciding between doing what’s best for you and doing what’s affordable for your family. A good life insurance policy can help you do both.
  • Plan for the future. The cost of accidents, illnesses and injuries is unpredictable and mostly comes down to sheer luck. Being in a car crash might only make you a bit late for work, or it might simultaneously kill you, disable your partner, wipe out your savings, burden your children with debt and incur decades of crippling medical expenses. It’s obviously not possible to plan for this, let alone budget for it, except with life insurance. A life insurance policy lets you replace completely unpredictable potential costs with consistent, predictable and affordable actual ones.

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Coverage is the amount of money that you will be paid in the event of a claim. An insurance consultant can help you determine an appropriate amount. Calculator
Provides a lump sum payment if you become totally and permanently disabled and are unable to return to work.
Provides a lump sum payment if you suffer a serious medical condition. Cover can be taken out for 40-60 medical conditions depending on the policy you choose.
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Compare life insurance quotes from these direct brands

Details Features
Life Insurance
Life Insurance
Choice of cover options and flexible premiums to suit budget. No lock-in contracts and fast application.
  • Benefit payment of up to $1,500,000
  • Cover for applicants up to age of 65
  • 30 day cooling-off period
Go to site More info
Term Life Insurance
Term Life Insurance
Receive up to $1,500,000 in life cover and pay nothing for the first month. 10% Multi-life discount available.
  • Lump sum cover from $50,000 - $1,500,000
  • $15,000 Cash advance benefit
  • 10% Multi-life discount
Go to site More info
Term Life Insurance
Term Life Insurance
Save 25% on NobleOak life insurance and pay no premium for your first month.
  • Benefit of up to $1,500,000
  • Available for applicants up to 69 years old
  • 21 day cooling off period
Go to site More info

Maurice Thach

Maurice is a publisher for Daily research of Australia's insurance offerings allows him to breakthrough the noise of the many policies out there to uncover what can (and can't) be covered. Maurice hopes to make finding the right insurance easier for all.

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