Term Life Insurance

What is Term Life Insurance?

It pays an agreed lump sum of money in the event of your death or terminal illness (ie an illness from which you are expected to die within 12 months [according to a medical practitioner], thereby allowing for an advance payment). Most policies can be renewed up to age 99. The only exclusion on the policies is death due to suicide in the first 13 months.

In the event of your death, your family can use the lump sum payment from life insurance to:

• Pay off debts, and
• Provide an income to maintain their lifestyle and achieve their financial goals

Do Term Life products differ across different insurers?

Life Insurance is a simple insurance policy and is similar across most insurers. There is little, if any difference between most life insurance policies. All life insurance policies that we quote offer as standard Terminal Illness Benefit and a Funeral Benefit.

Term Life Insurance Options

Most Life Insurance policies provide the option of including Total & Permanent Disability (TPD) and Trauma Insurance. These can usually be taken as a linked or standalone additions. For additional information see the:

• Insurance buy-back page

How much does term life insurance cost?

Premiums are calculated on your:

• Age (premiums may increase or decrease as you get older)
• Gender (women generally live longer than men so pay lower premiums), and
• Whether or not you smoke.

Tax treatment

Life Insurance premiums are generally not tax deductible, however this also means that the benefits from a Life Insurance policy are generally also tax free (non-superannuation).

Term Life Insurance Tips

Do not confuse Life Insurance with ‘accidental death’ insurance. Life Insurance will provide a payment regardless of the method of death (except suicide in the first 13 months). Accidental death, while offering significantly lower premiums offer very limited protection.

Alternate Names

Sometimes known as Life Insurance, Life Cover, Death Cover or Term Life Insurance.

Next: How Much Life Insurance