Term Life Insurance

What is Term Life Insurance?

Also known as death cover, life cover, or just life insurance, term life insurance pays an agreed lump sum of money if you die or are diagnosed with a terminal illness. Most policies can be renewed up to age 99. On most policies there is an exclusion applied in the first 13 months of the life of the policy if the death is due to suicide.

If you die, 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 not confuse life insurance with accidental death insurance. Life insurance provides a payment regardless of the method of death. Accidental death cover offers very limited protection because of its significantly lower premiums.

Do Term Life Policies Differ Across 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 Terminal Illness Benefit and a Funeral Benefit as standard.

Term Life Insurance Options

Most life insurance policies provide the option of including total & permanent disability (TPD) and trauma insurance. These can usually be either linked to your life insurance policy, or managed as a stand-alone policy (even if you do have life insurance). For more information see our guide to buying back insurance.

How Much Does Term Life Insurance Cost?

Premiums are calculated based on a number of factors, including:

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).

Next: How Much Life Insurance Do I Need?

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