Want to calculate how much life insurance you need? Simply use our tools below.
Use our tools below to get a clear idea:
- How much insurance to leave your family if you die or a life-changing disability happens to you.
- The type of cover you need (e.g. death protection, income protection).
- How you'd expect to pay
Calculator 1: How much to leave your family
Life insurance calculator: Find out how much cover you need.
1) How much debt do you owe?
Include mortgages, credit cards, car loans, student loans and other debt.
2) How much do your loved ones need each month?
Start with how much you take home monthly, adding rent, food and necessities.
3) How many months will your loved ones need the income?
Indicate how long you think your loved ones need before they can sustain themselves in your absence
Your recommended coverage:
Calculator 2: What type of cover you need
Find the right coverage
Answer two quick questions to work out the type of cover you need.
Question 1 of 2
Calculator 3: How much you'd expect to pay
Simply click below to go to our engine. You can pick various types of cover and get a live quote.
How to calculate how much life insurance you need
The calculator above lets you enter details about your current and future cover requirements to help you estimate an adequate level of cover. If you want to calculate it yourself (in detail), follow the guidelines below:
Step 1 - Determine how long you want to support your family for
- Enter the number of years that you think your family will need support for
Generally, if you are more financially secure you are (e.g. your assets) the length of insurance required.
Step 2 - Add up your current debts
- The sum existing on your mortgage
One of the biggest financial commitments (debts) for most Australians is their mortgage. Life Insurance can be used to discharge the mortgage in the event of your death or injury and if that’s one of the reasons why you’re assessing your insurance needs then you should add your outstanding mortgage balance here.
- Other existing loans
Life Insurance can be used to pay out your personal debts in the event of your death or injury and if that’s one of the reasons why you’re assessing your insurance needs then you should add your outstanding debts here
- Funeral expenses (optional)
Think about the type of funeral you would like to have an adequate sum to put away for this. Learn more about how much funerals cost in Australia
Step 3 - Add up your families monthly living expenses
- Monthly ongoing living expenses (general household bills)
Apart from your mortgage (and any school or university fees) what do you spend each month to maintain your lifestyle? Review your budget to understand how much monthly income you and your family actually need to pay their bills and maintain your household.
Step 4 - Determine what you would have to pay in school fees for your children
- Add together number of dependents and remaining years at school
Dependents includes your children or anyone who is financially dependent on you and the income you earn. It’s generally refers to minors and to those who are currently unable to support themselves financially. Think about how long they have remaining at school and annual tuition fees
Step 5 - Add up your current assets and offsets that could be used in the event of your death
- Current Savings/Term Deposits
This includes cash (in any form), foreign currency (in Australian dollars), and any assets held in a bank account or equivalent.
Shares will fluctuate in value over time and produce variable levels of income and growth. For the purpose of this calculator use an approximate value based on current data but remember to exclude shares in private companies and suspended or highly illiquid stocks – after all, if the shares can’t easily be sold then they should be excluded from consideration.
- Other assets that could be sold off
If you have other assets that could be sold to discharge your debts or support your family then they should be recorded here. This may include your investment property, your art collection, and your boat or holiday home. It’s best to be conservative when valuing these types of assets.
Step 6 - Determine how much cover you have in your superannuation
- The balance of your superannuation
Most working Australians are members of one or more superannuation funds that will provide a benefit to them (or their estate) in the event of the death or retirement of the member. Think about all your superannuation accounts and insert the total balance here
- Existing cover you already have
Most working Australians are members of one or more superannuation funds that will provide a benefit to them (or their estate) in the event of the death or retirement of the member. Most Funds also provide a level of life insurance cover to their members. Think about all your superannuation accounts and insert the total insurance cover they provide here
- Apply an appropriate inflation rate
Over time, inflation reduces the purchasing power of your money. This sound complicated but it simply means that when inflation is high things cost more. In periods of low inflation, your money buys more. Inflation will change over time but the figure you include here will help you manage this risk.
Still not quite sure what may need to be covered? Use a needs approach...
Make sure your life insurance can cover the following needs:
Immediate needs in the event of death
- Funeral expenses
- Emergency fund for unexpected costs: to cover any medical costs for any hospital needs upon illness or injury
- Outstanding taxes
- Outstanding debts: credit cards, personal loans, etc
- Estate settlement costs
- Legal costs
- Your children's education expenses.
Ongoing income needs to meet day-to-day expenses:
- Shelter: utility bills, maintenance costs
- Insurance: health, car, home and contents insurance.
Your families specific circumstances
- Your partner's age
- The number of children that you have and their age
- Whether or not your partner is working and his/her capacity to earn an income
- Your outstanding debt (including your mortgage)
- Whether or not you will be providing funds for your surviving partner's retirement
- The number of years you are willing to fund your family's ongoing needs
Special funding needs
- University funding
- Charitable donations
- Buy/sell agreement funding
- Business succession planning
What other factors will influence how much cover I take out?
Some of the main factors that will influence the amount of cover you take out include:
|Factor||How it will influence how much I take out?|
|The total cost of a policy||The more cover you take out, the greater the total cost of a policy. If the total cost is too expensive, it may limit the amount of cover you take out.|
|Your age||If you take out life cover at a younger age you'll able to take out a larger amount of cover.|
|The type of cover||If you package your life insurance with trauma, you may take out a grater sum.|
Find out if you already have life cover in your super
A death benefit from your super fund can be paid to your dependents, such as:
- Your spouse/partner
- Your children under 18 years of age
- Any person who is in an interdependent relationship with you (as the fund member)
- Any person who is financially dependent on you at the time of your death
- The total available assets that you and your family own.
Add the two together and deduct from the total expenses your family will need to cover and the difference can represent the amount of life insurance coverage that you may need to provide for your family in the event of your death.
The calculator featured above uses a relatively simple equation to help you find an appropriate level of cover based on your annual income, total debts and children. It is worth noting that the estimate it provides should only be used as a general guide to help you receive a preliminary quote. Once you have received a preliminary quote, it is still worth speaking with an adviser to help you determine an appropriate amount of cover for your situation.Back to top
How do I calculate what my premium will be?
Once you have received an estimate for the amount of cover to take out, you can submit your details in the form to have an insurer call you to discuss different cover options and provide you with a quote for cover?
Why can't I get an estimate for how much I will pay straight away?
Life insurance is an extremely complex product and an insurer will need to get some more details about your personal situation before they can provide you with an accurate quote.
What will impact my premium?
There are a number of factors that will impact what you pay for cover including;
- How old you are
- Whether you are male or female
- Whether or not you smoke
- Certain pre-existing medical conditions
- The policy that you choose and premium structure
How can I reduce my premium?
- Quit smoking - smoking can increase your premium by 100%!
- Live a healthy life - health risks such as high blood pressure and obesity can impact what you pay
- Pay your premium annually rather than monthly
- Bundle different types of cover together rather than buying separately
- Take out cover with your partner to receive a multi-policy discount
- Fund your cover through superannuation
Can I increase my premiums later?
There are multiple reasons why you may want to increase your life insurance cover. Your personal circumstances may have changed (eg you get married, have a child, suffer an illness, etc), or you may simply decide that the benefit amount is not enough to keep pace with the cost of living. Whatever the reason, if you do decide to increase your cover, there are several ways you can do this:
- Applying to increase your benefit amount. You can also apply to your insurer to have your benefit increased, but you may have to undergo another assessment of your health and circumstances.
- Automatic CPI Indexation. Every year at renewal time, your insurer will offer to increase your cover to keep pace with the Consumer Price Index (usually around 5%). Choosing to accept this offer will at least ensure your benefit amount keeps up with inflation.
- Guaranteed Future Insurability benefit. If your policy includes this benefit, then you will be able to increase your cover under certain conditions, without the need for a medical reassessment.
|Brand||Future Insurability Feature||When will this feature expire (Renewable date following)|
|AIA||Yes||Policyholders 55th birthday|
|AMP Elevate||Yes||Policyholders 55th birthday|
|Asteron||Yes||After policyholders 60th birthday|
|BT||Yes||Policyholders 55th birthday|
|Comminsure||Yes||"The cover expiry date or after the life insureds 45th birthday"|
|MLC||Yes||After policyholders 55th birthday|
|OnePath||Yes||Policyholders 55th birthday|
|TAL Accelerated Protection||Yes||Policyholders 55th birthday|
|Zurich Wealth Protection||Yes||After policyholders 54th birthday|
|Zurich Ezicover||Yes||Not stated|
|TAL Lifetime Protection||Yes||Policyholders 55th birthday|
|American Express||Yes||Policyholders 54th birthday|