How you can get the best life insurance on the market.
- See what the experts think is the best. You can do this by comparing customer satisfaction, product awards and a company's financial strength.
About the author
Maurice Thach An insurance researcher and writer for finder.com.au who loves finding an answer to the question "Am I covered for ________?" Maurice has also completed a Tier 1 Life Insurance and a Tier 2 General Insurance Certification under ASIC's Regulatory Guide 146. This means he can confidently provide general advice for life insurance and non-life insurance products.
This depends on what factors you are accessing. We've looked at our own data and research from different expert publications to give you a high level idea of what could be the "best".
Most popular direct brands on finder (2018)
Most popular brands sold through advisers on finder (2018)
Based on clicks to direct insurer websites and sent enquiries from users (where they sign-up for a phone call from an adviser) to advisers from 1 January to 7 May 2018. You can learn more about the numbers here.
Best life insurance brand for customer satisfaction (2017)
- Source: Roy Morgan. Learn more.
Best rated life insurance policy (2016)
- Source: Australian Financial Review. Learn more.
Insurer with the largest market share (2017)
- Source: Strategic insight. Learn more.
Insurer with the strongest financial rating (2017)
- Source: Standard & Poors. Learn more.
From 1 January to 7 May in 2018, we looked at two groups of life insurance brands:
- Those who sell their products on their website "direct".
- Those who sell their products using an adviser "retail".
|Popularity ranking||Brand (sold on its website)|
|1||NobleOak Life Insurance|
|2||Real Life Insurance|
|3||Virgin Life Insurance|
Methodology: We analysed six life insurance brands on our panel that sell products directly on their websites. Here are the most popular based on user clicks from our website to respective brand websites.
|Popularity ranking||Brand (sold through adviser)|
|1||OnePath Life Insurance|
|2||AIA Priority Protection|
|3||MLC Life Insurance|
|5||TAL Accelerated Protection|
|7||Asteron Life Complete|
|8||Zurich Wealth Protection|
Methodology: We analysed ten life insurance brands on our panel who sell their products through advisers. Here are the most popular based on inquiries on our life insurance engine.
Roy Morgan analysed 13 of the largest insurers in Australia and found the highest levels of customer satisfaction in Insuranceline, Allianz and AIA Australia.
|Life insurance brand||Customer satisfaction (2017)||Customer satisfaction (2016)||Change|
Roy Morgan Single Source (Australia) December 7 2017
Below is a list of the top life insurance policies the Australian Financial Review selected for its annual Blue Ribbon Awards. The criteria it considered included: clear pricing and definitions, a wide range of features, flexibility and substantial benefit amounts.
Best term and Total and Permanent Disability Insurance (TPD)*
Listed below are the best term and TPD insurance policies of 2016. All these policies offer $5 million in TPD cover and unlimited life cover.
|Product name||Product details||Maximum Age to Apply|
|MLC Life Cover with TPD Rider – Term/TPD Policy||Offers policies with the most features combined with clear pricing from all compared.||59|
|TAL Accelerated Protection – Life Insurance – Highly commendable||Life insurance cover can be bought back after claiming for TPD.||62|
|Comminsure Life Care – Highly commendable||Offers a Plan Protection Option to keep your cover going if you become disabled.||69|
One way to look at this is by considering the market share of an insurer. We looked at "Total risk premium inflows" and found TAL with the largest market share in Australia (as of September 2017).
|OnePath Australia Group||10.0%|
|BT / Westpac Group||6.50%|
Market share based on Total Risk Premium Inflows ending in Sept 2017. (Strategic Insight)
Standard & Poors is an independent body that looks at the financial strength of life insurers in Australia. A company with solid financial solvency tells you how worthy they are from a credit standpoint. This gives you an idea of whether a company will be able to pay claims today and later down the track.
A triple A (AAA) rating is the highest available rating.
|Company||Rating||What does this mean?|
|AIA Australia Ltd||A+||Strong financial security but more likely to be affected by adverse business conditions (vs insurers with higher ratings).|
|AA-||Very strong financial security but more likely to be affected by adverse business conditions that (vs an insurer with a AAA rating).|
|Challenger Life Company Ltd.||A||Strong financial security but more likely be affected by adverse business conditions (vs insurers with higher ratings).|
|Colonial Mutual Life Assurance Society Ltd. (The)||A+||Strong financial security but more likely be affected by adverse business conditions (vs insurers with higher ratings).|
|Hallmark Life Insurance Co. Ltd.||BBB+||Good financial security but more likely be affected by adverse business conditions (vs insurers with higher ratings).|
|MetLife Insurance Ltd.||A+||Strong financial security but more likely be affected by adverse business conditions (vs insurers with higher ratings).|
|National Mutual Life Association of Australasia Ltd. (The)||AA-||Very strong financial security but more likely to be affected by adverse business conditions that (vs an insurer with a AAA rating).|
|OnePath Life Ltd.||A+|
|Suncorp Life and Superannuation (Owner of Asteron Life Insurance).||A|
|Westpac Life Insurance Services Ltd.||A+|
Standard & Poors conducted a study in November 2017
Doing your own research? We asked various members of finder's insurance content team to find out which inclusions were the most important and why.
Maurice Thach - Life Insurance Researcher:
1. A guaranteed future insurability benefit
"A guaranteed future insurability benefit allows you to increase the amount you're insured in the future as your life changes, for example if you get married or have children.
"The real advantage of having this inclusion is that you can increase your cover without having to take a medical reassessment. So if you develop a pre-existing medical condition after you have bought life insurance, you'd still be able to increase your cover.
"There may be some limitations like the not being to make a claim in the first year of increasing your sum insured as well as an age where you can no longer use the benefit".
Richard Laycock - Insurance Editor:
2. Full underwriting if you have pre-existing medical conditions
"If you have a pre-existing medical condition or a dangerous job then you'll want to ensure your cover is fully underwritten. This means your health is checked up-front. While it does take longer, it also means you'll get to know if you're covered when you apply instead of receiving a nasty surprise at claim time.
"Generally, life insurance you buy through an adviser will be fully underwritten. For policies that are direct, only some are fully underwritten".
Zahra Campbell-Avenell - Insurance Publisher:
3. A higher expiry age
"The expiry age is the age you reach where you're no longer covered. A higher expiry age means you'll be able to stay covered for longer meaning there's less chance of outliving your policy. Look for a higher expiry age to ensure the money you pay in premiums doesn't go to waste".
Richard Laycock - Insurance Editor:
4. The right type and amount of insurance for you
"It's possible to miscalculate how much life insurance you need, eg taking out $10 million in cover when you only have one child and a house worth $500,000. By the same token, it's possible to take out the wrong insurance cover, eg death cover if you have no one depending on you.
"This is why it pays to use a calculator to work out your needs in terms of both: sum insured and type of insurance".
Maurice Thach - Life Insurance Researcher:
5. A clear understanding of exclusions
"Not knowing what you're not covered for can be detrimental when you actually need to claim. Imagine suffering a major injury, then being knocked back because you didn't realise you weren't covered for the time period for where you worked previously".
The graph below shows the different insurance needs based on your life stage. This should only be used as a guide as requirements can change depending on your own situation.
Tip: Review your policy regularly
If you already have cover in place, you should review your policy regularly to ensure you are not overinsured or underinsured. Events that can affect your policy include:
- Marriage or divorce
- Buying a new home
- Children moving out or becoming financially independent
- Changes in health
Most advisers recommend that you review your life insurance policy at least once every 12 months. There may be a better-priced and/or more suitable option available.
- Determine an appropriate level of cover: Consider your current financial obligations and how long you are likely to require cover to determine an adequate amount of insurance. You may find that a cheaper policy with fewer features is still sufficient for your situation.
- Review existing cover: You may already have some cover via your superannuation or your employer, or included in other insurance products. Assess what is already in place and see if you need to upgrade.
- Live a healthier lifestyle: Pre-existing medical conditions, smoking, alcohol consumption and obesity can all drive up your premiums; smokers usually pay double. Live a clean lifestyle and get rewarded with lower premiums.
- Speak with an insurance adviser: An adviser can use their market knowledge to help you find competitively-priced cover.
- Consolidate existing cover: You may have some life insurance accumulated across different superannuation funds. Consolidating the cover can help you avoid multiple charges.
- Combine policies: Some insurers offer multi-policy discounts if you take out cover for your spouse or child, or if you take out other types of personal insurance with their company.
Australian insurance providers use different methods to attract and reward customers. Common discounts you can ask about when applying for life insurance include the following:
- A multi-policy discount: When you have more than one insurance policy with the same insurer, you often qualify for a multi-policy discount. For example, if you have home and car insurance with a particular insurer, ask if you qualify for a discount for taking out life insurance with them too. You could save around 5% on your premiums.
- Multiple life insurance policies: You can also take out more than one type of life insurance policy to qualify for a discount, for example, if you are a small to medium business owner you can purchase coverage for yourself, your family and your business. These additional insurances can also offer potential tax benefits and savings at tax time.
- Discount for a large sum: If you are insured for a large benefit amount, for example more than $1 million, you may be eligible for a discount on your premiums.
- Making annual payments: If you pay your premiums annually, rather than fortnightly or monthly, many insurers will offer you a discounted rate. In some cases you can save up to 8%, plus you have the ease and convenience of making just one payment, secure in the knowledge you are covered for the entire year.
- Health and lifestyle: A healthy lifestyle can also result in discounts. For example, if you can show proof of gym membership or evidence of health screening, you often qualify for a discount of around 10% on premiums.
A sample of what is offered
Following are examples of some of the benefits and discounts that three of Australia’s major life insurance providers offer:
- Counselling and grief support: A life insurance policy claim normally occurs after a major event such as death, serious injury or a critical illness diagnosis. AIA provides 24/7 counselling support for you and your family in such circumstances.
- Legal and tax advice: Although the main aim of life insurance is to reduce financial pressure in the event of a death, there can still be a number of legal, taxation and financial decisions that will be necessary. AIA offers legal assistance for an injury, dispute or litigation which may arise.
- Home assistance: If you make a claim on your life insurance due to disability or illness, it's likely you are going to need more help with everyday tasks. AIA can provide in-home assistance with tasks such as household duties, gardening, child care or cleaning.
- Funeral planning: When a loved one has passed away, it can be difficult to think about the details of planning a funeral. AIA offers assistance choosing a funeral director, a cemetery or cremation service, and can plan a function and catering following the service.
- Complete worldwide coverage: This benefit means you and your family are covered for serious illness or injury anywhere in the world, 24 hours a day, seven days a week. You can also cover each of your children for a maximum benefit of $10,000 for illness or injury.
- Rewarding loyalty: As a loyal customer, Asteron will reward you by increasing your coverage amount without requiring you to undergo any further medical examinations.
- Advance funeral benefit: If you face paying for a funeral, Asteron will pay an amount in advance of the full benefit to help cover immediate expenses.
- Financial planning reimbursement: If you or your family seek financial advice after receiving the full benefit amount, Asteron will reimburse you the cost of this advice.
- Comprehensive and extensive financial management: As well as life insurance policies and options, MLC also offers investment, superannuation and private wealth management solutions.
- Strength in numbers: MLC currently manages more than $122 billion on behalf of individuals and corporate customers in Australia.
- Access to the best doctors in the world: MLC can connect you with 50,000 of the best doctors around the world so that you can receive world-class treatment and advice no matter what your condition.
Australian providers often provide children's insurance as a free extra when you take out a life insurance policy. Adding your children will generally cover them in the case of:
- a traumatic event, or
- a terminal illness.
The exact illnesses and injuries your child is covered for will differ between providers. However, you generally receive a tax-free benefit of between $10,000 and $25,000 on your child’s life insurance claim. Children aged from 2-16 can be covered under your policy, and can often convert to a full policy when they reach adulthood.
The benefit you can receive by having your child covered under your policy can assist you in the following ways:
- It can provide the financial flexibility for you to take time off work to care for your child.
- You can use it to pay for specialist treatments.
- It can cover everyday bills such as mortgage, school fees or child care for your other children.
- It will allow you to pay for home and car modifications to accommodate your child.
- You can keep your child comfortable and secure while they deal with a difficult time in their lives.
Pre-existing medical conditions
It is still possible to find affordable life insurance coverage if you have a pre-existing medical condition.
High-risk occupation cover
If you work in a high-risk industry you may find it difficult and/or expensive to find life insurance.
Review life insurance brands*
Make sure you avoid these common pitfalls when looking for life insurance cover:
- Ignoring future costs: Think about your current bills and expenses and take into account what these will look like in the future. For example, if you have young children the cost of school and tertiary study is going to be significant in coming years, so make sure you allow for this when assessing what you can afford.
- Forgetting to cover the stay-at-home parent: Life insurance for a stay-at-home parent is also important. Consider points such as how much your family would have to spend on a housekeeper and child care if the parent became ill, was injured or died.
- Putting off taking out cover: Your premiums will only increase with age so think about taking out cover early and securing a competitive rate.
- Going with the cheapest policy: The cheapest policy will usually offer a reduced level of cover. Make sure the premium matches the quality of the cover provided.
- Skim over the terms and conditions: Take time to read the product disclosure statement carefully so you have a clear understanding of exactly what you will be covered for and the necessary conditions for a benefit payment.
* The offers compared on this page are chosen from a range of products finder.com.au has access to track details from and is not representative of all the products available in the market. Products are displayed in no particular order or ranking. The use of terms "Best" and "Top" are not product ratings and are subject to our disclaimer. You should consider seeking financial advice and consider your personal financial circumstances when comparing products.