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Term Life Insurance
Term life insurance is the main type of life insurance offered in Australia. It pays a specified sum of money to the insured’s beneficiaries or estate as long as the insured passes away while their policy is current. In exchange for the term life insurance policy, the insured agrees to pay monthly or yearly premiums to the life insurance company.
Most of the standard term life insurance policies expire at age 99; however each life insurance company may have slightly different definitions. When in doubt, make sure you consult the products disclosure statement (PDS).
Select Term Life Insurance
The second type of term life insurance is Select Term Life Insurance. Select Term Life Insurance pays a lump sum on the life insured’s death, terminal illness or total and permanent disablement during a selected fixed term of 5, 10 or 15 years.
Money-back Term Life Insurance
Money-back Term Life Insurance is the third type of life insurance Life Insurance in Australia. Generally speaking, this type of insurance is most suitable for people who are in a particular situation and find it difficult to get life cover. For example, Money-back Term Life Insurance may suit those with a medical condition like severe diabetes.
Money-back Term Life Insurance is as close as you can get to Whole of Life Insurance, however Whole of Life insurance is no longer available in Australia. Money-back Term Life Insurance pays a lump sum, equal to 100% of the total premium paid, at the benefit expiry date provided:
- Premiums are paid in full when due,
- No terminal illness benefit has been paid, and
- No death benefit has been paid.
| xLife is one of the few financial advisers in Australia who can sell Money-back Term Life Insurance. If you believe this type of insurance suits your needs, please call us on 1300 135 205. |
Determine how much term life insurance you need
Apart from choosing the right term life insurance policy to suit your needs, determining ‘how much’ life insurance you need is a very important step. It is the amount paid upon your death, and is decided when the policy is taken out. Generally speaking the main rule of thumb is to take out a policy that is ten times your annual income. This value usually relates to your current and future liabilities, and the amount of income you generate. You may find it helpful to get advice from a qualified and experienced term life insurance adviser. A life insurance adviser will typically assess your:
- Debts – mortgage, credit cards, loans.
- Expenses – daily living expenses and future expenses like education for your children.
- Ongoing income needs of your family.
If you failed to purchase a term life insurance policy for the right amount, would your family be able to financially cope if you weren’t there?
Compare term life insurance policies
Life insurance companies take into account your age, gender, smoker status and health history before determining your premium. So if you need help in finding the right type, and the right level of cover, contact xLife today.
Exclusive Offer! Call xLife on 1300 135 205 today and
save up to 20% on your first year’s life insurance premium.
December 2009
