What is Death Cover?

Death cover provides security in times of uncertainty

One of the best ways to secure your family’s future is by obtaining a death cover insurance policy. It is a traditional life insurance policy that backs up your ability in meeting your family's financial obligations in case you pass away unexpectedly. Death cover is commonly known as life cover in the Australian market.

What are the key features of life cover?

  • Lump sum payment. Death Cover provides a lump sum payment if the policyholder is to pass away
  • Additional benefits. Additional benefits may be provided to cover funeral and financial planning expense

Compare quotes for life insurance cover

Please enter your full name
Please enter a valid email address
It's important to give us a valid phone number
Date of Birth
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.
By submitting this form, you agree to the finder.com.au privacy policy
Compare Quotes

Receive a quote with these direct brands

Product details Maximum cover Maximum Entry Age Cooling-off
Life Insurance
Life Insurance
Choice of cover options and flexible premiums to suit budget. No lock-in contracts and fast application. $1,500,000 65 30 Get quoteMore info
Term Life Insurance
Term Life Insurance
Receive up to $1,500,000 in life cover with American Express Term Life Insurance issues by Zurich. $1,000,000 69 30 Get quoteMore info
NobleOak Term Life Insurance
NobleOak Term Life Insurance
Save 20% on NobleOak life insurance and pay no premium in the first month. $15,000,000 69 30 Get quoteMore info
Life Insurance
Life Insurance
Get flexible life insurance up to the sum of $2,000,000. $2,000,000 59 21 Get quoteMore info
Woolworths Life Insurance
Woolworths Life Insurance
Receive a discount of 10% on life insurance as a Woolworths Rewards Member. T's and C's apply. $1,500,000 65 30 Get quoteMore info
Ezicover Life Insurance
Ezicover Life Insurance
Get up to $1.5 million in life cover. 10% discount available on a second life insurance policy when two policies are issued at the same time. $1,500,000 69 30 Get quoteMore info

What are the features and benefits of death cover?

Life is full of uncertainties and you want to have the peace of mind that your family is able to maintain the quality of life they live today and in the future. When you pass away or have been diagnosed with a terminal illness, it can have a devastating effect to your family. Not only that they have to deal with the grief of losing you, but they also need to figure out how they can keep up with the bills and expenses that will still need to be paid.

This is where a death cover policy can help, by providing them with a lump sum payment benefit to minimise the financial burden, allowing them with a smoother transition to a life where you are no longer around to care for them.

What type of expenses am I covered for?

Some of the expenses that death cover can provide relief for, include:
  • Rent or mortgage repayments
  • Children’s education expenses
  • Daily living expenses and needs, such as food and clothing
  • Costs to hire housekeeper or nanny
  • Home maintenance costs
  • Funeral expenses
  • Legal expenses
  • Estate settlement costs

How do I determine my life insurance needs?

It is difficult to set a standard insurance policy that would apply to all policy holders. There is not just one death cover that can be considered to be ideal to all, which is why it is important to assess and compare different policies to determine which plan would be most suitable to you and your family's needs. Deciding on the death cover amount to insure may not be such as a simple task, but the best way to calculate the right amount to match your needs, consider:

  • You current annual income. Replacing your lost income for the years required
  • Short-term and long-term debts. This often includes mortgage, credit card debts, personal loan, and car loan
  • Your immediate expenses. This includes food, clothing and shelter (rent payments, if you don't own your home)
  • Your children's education expenses. Consider the number of children you have and their respective ages to determine the total amount of expenses
  • Emergency funds. Work out how much of your expenses such as a funeral arrangement, medical treatments, legal fees and estate settlement costs can be covered by your savings.

You can use a life cover calculator to give you an indication on how much you may need for a death cover. If you require further assistance, an experienced death cover agent can help you in determining an ideal amount that will match your needs situation, as well as providing tailored advice on life policies that suit what you require.

Forms of Death Cover Available for You

Life insurance provider typically offer three forms of death cover products which are whole life insurance, term life insurance and funeral cover. If you need to obtain financial security to pay for your funeral costs and you are not eligible to obtain term life insurance (due to specific medical condition or age), a funeral plan is a good option. This form of death cover insurance pays for all funeral expenses, which often includes:

  • The mortuary facilities
  • Coffin or casket
  • Burial or cremation costs
  • Flowers and wreaths
  • Grave equipments
  • Obituary notice in newspapers
  • Official documentations needed to register death

Whole life insurance and term life insurance share similar features which include payment of the death benefit in form of a lump sum to the policyholder’s financial dependents. Unfortunately, whole life policy is no longer available in Australia; however, you can still obtain term life insurance and it is a popular type of protective insurance, due to its affordability and flexibility in choosing a term of coverage that suits you. Obtaining a funeral plan will give you short-term solution to subsidise the expenses incurred from funeral arrangements, while a life insurance policy provides a long-term solution for your dependants' financial needs in case of eventualities.

Death cover for different life stages

Single people

You have finished your education and have left home to start your own way in life. You will be most fortunate if you can get through this stage of your life without taking on debt. There might be that new car you are paying off, for instance. At this stage of life, you should start thinking seriously about term life insurance. Since you are young and relatively healthy, the premiums you pay will be reasonably low and you can adjust the amount of coverage as your responsibilities increase. Having the additional benefit of disability cover to your death insurance can give you an extra layer of protection should you become disabled as a result of an accident or illness.

Married couples with children

When you are married with children, you have taken on additional responsibilities, in which you have others who are financially dependent on you. It's a possibility at this life stage that you have a mortgage, or if not, you are likely to do so in the near future. If you pass away unexpectedly or become disabled through injury or illness, your dependents will be at risk of financial hardship, if you have no appropriate protection in place. With term life insurance, your family can continue the lifestyle they have become accustomed to and alleviate the stress of having to meet the ongoing financial obligations, when you as the main provider, is no longer around.

What is funeral cover?

Funeral cover is a simple insurance product that can provide many benefits and you have the flexibility to choose the amount you want to insure yourself for. If you are in the older age group and have little debt all, you may want to consider a funeral plan that will take care of your funeral costs, which can be quite considerable in this day and age. Funeral costs are the type of expenses that you wouldn't want to burden your loved ones with and with a funeral plan in place, your family can be rest-assured that they can afford the arrangement that you would've wanted.

Make an enquiry for death cover

Richard Laycock

Richard is the senior insurance writer at finder.com.au and is on a mission to make insurance easier to understand.

Was this content helpful to you? No  Yes

Related Posts

Ask a Question

You are about to post a question on finder.com.au

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com.au is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Disclaimer: At finder.com.au we provide factual information and general advice. Before you make any decision about a product read the Product Disclosure Statement and consider your own circumstances to decide whether it is appropriate for you.
Rates and fees mentioned in comments are correct at the time of publication.
By submitting this question you agree to the finder.com.au privacy policy, receive follow up emails related to finder.com.au and to create a user account where further replies to your questions will be sent.

Ask a question