What is life insurance?
Discover the ins and outs of life insurance, from how it works to why it's so important for many families.
What is the Finder Score?
Life Insurance is a little complicated and a lot overwhelming. That's why we made the Finder Score, to make it easier to compare Life Insurance products against each other.
Our experts analysed 11 products and gave each one a score between 1 and 10. The scores are based on 13 features, including price.
- 9+ Excellent - These products offer great value, with a good score across both features and price.
- 7+ Great - These are competitive products, though they didn't quite get top scores.
- 5+ Satisfactory - These products might offer less value or command a higher premium than others in the market.
- Less than 5 – Basic - These products might only offer a basic set of features or aren't very competitive on price.
Remember that Finder Score is just one factor to consider. Look at other aspects like fees, features, benefits and risks to make sure a product is suitable for you. Double-check details that matter to you before applying or buying.
To be eligible for a Finder Score, providers must provide us with quotes. We use the average price across 12 personas. The personas we collect quotes and use for the purpose of Finder Score are:
The Finder Score methodology is designed by our insights team and reviewed by our editorial team. We review the products objectively. Commercial partnerships do not affect the score.
How much does life insurance cost?
The average cost of a life insurance policy is $1,258 annually, according to Finder research of 11 providers.
The cost of your life insurance premium will depend on the following:
- Your age
- Your health and any pre-existing conditions
- Your lifestyle choices, for example, if you're a smoker or if you exercise regularly
- The level of cover you choose
- How many optional extras you do or don't add on
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You pay the same price as buying directly from the life insurer.
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We're not owned by an insurer (unlike other comparison sites).
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We've done 100+ hours of policy research to help you understand what you're comparing.
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The cost of life insurance is highly dependent on personal factors so your own annual premium is likely to be different to our average cost. This information should be used as a guide only.
Other types of life insurance
Total and permanent disability (TPD)
TPD covers you if you get severely injured or sick. For example, if you become blind or paralysed after a car accident and become permanently disabled.
Typical cover range: $50,000 to $5 million.
Trauma insurance
Trauma cover, sometimes called critical illness cover, is a policy add-on that pays a lump sum if you're diagnosed with a major medical condition, such as cancer or a heart attack.
Typical cover range: $500,000 to $2 million.
Income protection
Income protection insurance pays a monthly benefit if you're unable to work due to illness or injury. Usually, it will only pay up to 70% or 75% of your typical wage for a period of 2 or 5 years.
"I've never really thought about my life insurance, but after having a baby and buying a house in the same year I felt now was the time I needed to take out cover. Having a policy that would cover my mortgage payments is one less thing I now need to worry about."
Learn more about life insurance
Our life insurance guides can help you compare and understand what cover option is right for you.
How to make a life insurance claim
3 simple steps to make the claims process go more smoothly during a difficult time.
Stepped vs level premiums: What's the difference?
Stepped premiums increase as you age, level premiums don't — but the latter is pricier to start with.
Expert tips on comparing life insurance
"People tend to underestimate the importance of life cover. With the right policy in place, your family's finances and wellbeing can be protected for decades. One feature I always tell people not to overlook is TPD cover. It isn't automatically included in a policy."
Life insurance is a policy you hopefully won't claim on for many decades, but what it buys you in the interim is peace of mind. It's important to consider what your debts look like and if your family could manage these without you. I'm married with three kids, and my life insurance policy gives me reassurance that if the worst should happen, my home will be paid off and my family won't have to deal with losing their home while they're grieving.
Sarah Megginson
Head of editorial
No one is ever really prepared for life's harsh surprises, but insurance can help soften the blow... Life insurance is about protecting what matters most. That's the people around you, rather than just material possessions like cars or boats.
Phil Thompson
Financial adviser at Skye Wealth
Why compare life insurance with Finder?
FAQs
Why you can trust Finder's life insurance experts
Karen Eley is the founder of Women Talking Finance, which provides money coaching and financial literacy and education services. An experienced and former financial adviser who has worked in financial services industry for 22 years, Karen is a Certified Money Coach (CMC), holds a Bachelor of Accounting and an Advanced Diploma in Financial Planning and CFP.
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