Life insurance can be an overwhelming topic – not least with the number of options available, from term life insurance to trauma insurance, to total and permanent disablement (TPD) insurance and lots more. This page can help you learn about life insurance news, to help you make more informed choices.
The cost of insurance premiums in Australia has been on the rise in recent years. Undoubtedly, natural disasters and the COVID-19 pandemic are 2 factors that are contributing to higher costs. According to Munich Re, 2021 was the second most costly year for insured losses from natural catastrophes. The resulting claims from such events are directly linked to premium rises, as insurance companies are forced to cover their substantial reinsurance costs.
Life insurance has certainly felt the squeeze recently. For example, the cost of insurance purchased through superannuation funds rose 7.4% last year. Despite insurance through super often being a cheaper option due to each super fund’s group buying power, it’s becoming more and more expensive to take out cover via this route.
Elsewhere, new APRA rules have tightened the way income protection insurance benefits work. Benefits were capped at 90% of earnings at the time of claim for 6 months, then at 70% after the 6-month period. Generally, these and other market developments have led to a greater impetus for consumers to shop around for better terms and more competitive pricing.
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Frequently asked questions
Essentially, yes. Life insurance policies have covered infectious diseases (of which COVID-19 is one) for many years.
Read more on what life insurance covers you for when it comes to COVID-19. Or, you can find out the key points of income protection and COVID-19.
Yes. Even though more than 4 in 5 policyholders with TPD cover hold their policy through their superannuation fund, it's definitely an option to buy standalone TPD. In fact, buying this way typically leads to more comprehensive coverage.
TPD insurance pays out a lump-sum if you suffer a permanent injury or illness and are no longer able to work during the term of your policy. Usually, you have to be off work for a minimum of 3 or 6 months before your claim is considered.
Direct insurance is generally viewed as a quicker and simpler way to take out cover. Rather than being a time-consuming and stressful process, applying for a life insurance policy can be quick and straightforward. There are often no medical tests to undergo and it's quick and easy to compare multiple quotes online.
Just keep in mind, there are some downsides to the rise of direct cover. Although savvy consumers research their cover before signing on the dotted line, there is still a risk of customers not knowing the right type and level of cover for their needs. This presents the risk of Australians either ending up underinsured or paying money for extra cover that they don't need.
Home and contents insurance. Your home is likely the most valuable asset you have, so it makes sense to protect it against loss and damage. Many home insurance policies can also be paired with contents insurance, allowing you to also cover your treasured possessions against a range of risks.
Motor vehicle insurance. Compulsory Third Party (CTP) car insurance is mandatory across Australia. It provides compensation when the use of your vehicle causes a bodily injury to a third party. There are three other motor vehicle insurance options to choose from: Comprehensive, Fire and Theft Only, and Third Party Property only.
Business insurance. Each business faces its own unique share of risks, so it makes sense to find a business insurance policy tailored to your specific needs. Examples of cover offered include protection against fire and other defined events, public liability cover, professional indemnity, cover for damage to stock and equipment, and business interruption. Every business owner should have adequate cover in place for their operation.
Lender's mortgage insurance. Home loan borrowers who do not have at least a 20% deposit towards their home are required to take out lender's mortgage insurance. This protects the lender against the risk of a borrower defaulting on their loan repayments.
Workers' compensation insurance. This form of insurance is compulsory across Australia. If people suffer a work-related injury or illness, workers' compensation type of cover offers financial protection.
Travel insurance. Travel insurance provides financial protection against a wide range of travel risks including COVID-19, overseas medical emergencies and hospital costs, medical repatriation, cancellation fees and lost deposits, travel delay, lost or stolen luggage, rental vehicle excess, and personal liability.
Life insurance. This sector of the market covers a wide range of insurance policies. In addition to term life insurance, which ps out a lump sum benefit in the event of your death, it also includes trauma cover, total and permanent disablement cover, income protection, and funeral insurance.
James Martin was the insurance editor at Finder. He has written on a range of insurance and finance topics for over 7 years. James often shares his insurance expertise as a media spokesperson and has appeared on Prime 7 News, WIN News, Insurance News, 7NEWS and The Guardian. He holds a Tier 1 General Insurance (General Advice) certification and a Tier 1 Generic Knowledge certification, both of which meet the requirements of ASIC Regulatory Guide 146 (RG146). See full bio
James's expertise
James has written 255 Finder guides across topics including:
Find out what life insurance policies are on offer from MLC and receive a free quote for cover. Apply securely with the help of an insurance consultant.
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You pay nothing. Finder is free to use. And you pay the same as going direct. No markups, no hidden fees.
You save time. We spend 100s of hours researching life insurance so you can sort the gold from the junk faster.
You can trust us. We say it like it is. We aren't owned by an insurer and our opinions are our own.