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Did you know you can have more than one life insurance policy at a time? You can get life insurance coverage that protects you for a number of life-changing circumstances, from income protection to death cover. If you have more than one valuable asset in your life, it often makes sense to have multiple policies.
Yes! Not only can you have more than one policy covering death, you can also take out other types of life insurance and have more than one of those policies as well.
There are four main types of life insurance policies and all help cover different life-changing circumstances. Depending on your needs, you might want cover for all of them.
An adviser can help you find cover from trusted life insurance brands.
There are a number of reasons you might have multiple life insurance policies. Some of the main reasons are listed below.
There's no limit, but you don't want to be over-insured, so it's important you know exactly what each policy does. For example, if you have a group policy in your super fund and another policy with additional types of cover, like trauma cover, that is acceptable. Both should pay out.
Some policies have built-in offset clauses though. For instance, with income protection policies, you can generally only insure up to 75% of your salary to prevent you from taking out two policies and trying to claim on more than 100% of your policy.
However, you can have two income protection policies that have different waiting and benefit periods. For example, you might have an income protection policy in your super fund that has a 30-day waiting period and another with a 2-year waiting period that pays out until you reach the age of 65.
Yes, as long as you meet the terms and conditions of each policy, you should be able to claim on multiple policies at a time. To ensure they all pay out, always read the product disclosure statement (PDS) before you purchase a policy. Check the general exclusions section to make sure there are no offset clauses that cap the amount you can claim on multiple policies. Generally, you will only find this is the case with income protection policies. If you're not sure, talk to your insurer when purchasing additional policies to find out exactly how they may affect your existing cover.
Yes. With multiple life insurance policies, you can nominate different beneficiaries for each policy. Ordinarily, you can nominate up to five beneficiaries per policy, and it can be distributed as you wish.
The only time this isn't possible is if you have life insurance through superannuation. Unless you make a binding death nomination, the fund will decide on the beneficiary. A binding nomination on your superannuation life insurance policy would ensure that the benefits go to your intended recipients. This usually incurs a small annual fee to your super.
There are lots of ways you can get multiple insurance policies.
While having additional coverage and security is certainly not a bad thing, there are a few considerations that you should think about when it comes to taking out multiple life insurance plans. Some of the things to consider include the following:
In some cases, it might make sense. For example, it's completely normal for people to accumulate a number of superannuation funds as they move between jobs. Within these different superannuation funds, there may be a default level of life cover that has accumulated over time. Consolidating these multiple super life cover policies can bring the following benefits:
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Hi, I have life insurance with my Super and one with another company, but when I asked, I should only be paid by one insurance company if I die.
Hi Vino,
Thanks for reaching out to us.
For a life insurance product such as life cover, there are currently no restrictions in place against owning multiple policies with different providers. However, this may not be the case with some life insurance plans. It is essential to speak to an insurance consultant if you require some advice in owning multiple life insurance policies, as they have the expertise and knowledge of the life insurance market.
Best regards,
Rench
How the claim of multiple life insurance policy settled by each company? The sum assured for each company is different..how the total claim is settled ?
Hi Himmat,
Thanks for the question. If you have multiple life insurance policy with different brands you can claim benefits from each. Your total should be the sum of the individual benefits.
I hope this helps,
Maurice
Hi Himmat,
Thanks for getting in touch. finder.com.au is a comparison service and we are not permitted to provide our users with personalised financial advice. The claims process differs between insurers, so you should contact each brand for information about their claims process.
All the best,
Richard