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Buying Life Insurance

Find out more about the process of buying life insurance and how to compare offers with Savvy.

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, updated on July 10th, 2023       

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Life Insurance Banner - Elderly couple buying life insurance on their tablet

Making sure your family is taken care of if you suddenly die or become critically ill is a major priority for many people. However, it’s crucial to find a policy which is appropriate for your personal situation before buying life insurance. Find out how to buy life insurance policies online and compare quotes from different insurers with Savvy today.

How do I buy life insurance online?

Gone are the days when buying life insurance meant visiting an office and completing reams of paperwork. Whether you’re buying for the first time, buying for your parents or just looking for a new policy, Australian insurers have online platforms which allow you to purchase a policy directly.

If you’re on the hunt for a policy, Savvy can help you. The process for how to buy life insurance through us online is as follows:

  • Grab a quote: getting a quote through us allows you to see how much your life insurance would cost if you went through one of our trusted insurance partners. Insurers will generate estimates based on the information you’ve provided, such as your age, employment and amount of coverage you’re after. They’ll also ask about some of your lifestyle choices, including whether you smoke.
  • Compare through Savvy: once your quotes have been generated, you can set about comparing them to see which offers provide you more value for your hard-earned money. Comparing through us allows you to weigh up all aspects of these policies, from their benefit limits to their prices. After you’ve done your homework and found a deal you like, you can schedule a call back with a life insurance expert to talk through some of your potential policy’s finer details.
  • Snap up your policy: after finding an appropriate life insurance policy (following your chat with a life insurance expert), you can buy your policy. They’ll handle all the relevant paperwork which can help fast-track your application. Pending any waiting periods, your cover will then come into effect.

How do I compare policies when buying life insurance?

When you’re doing side-by-side comparisons of policies online, make sure you check the following points to help you find the most appropriate policy: 

What’s included

To make sure you're getting the most out of your money, it's a good idea to evaluate the benefits offered by different policies. Benefits including indexation, international coverage and advance payments for funeral expenses are standard across most life insurance policies, but they can vary between insurers. As such, it’s crucial to compare them to help you determine what you can be covered for before you buy.

What isn’t included

Life insurance policies come with certain general exclusions which can vary from provider to provider. Most policies won’t cover suicide (within the first 13 months of the policy), criminal activity or alcohol or drug use (unless prescribed by a doctor). It’s important to go through the fine print thoroughly and check what isn’t included and compare it to other policies, as you and your family will want to avoid any unwelcome surprises when you go to make a claim.

Premiums

You’re bound to have a close eye on the cost of your life insurance when you’re comparing quotes through Savvy. By obtaining a few policy estimates and doing a side-by-side comparison, you can improve your odds of getting a policy which provides the cover you're looking for at a price within your budget.

Types of insurance policies

Life insurance comes in all shapes and sizes, so it’s important to consider which one best suits your circumstances. You can choose from the following when you’re shopping for a policy, subject to meeting your insurer’s qualification criteria:

Coverage limits

If you want to make sure your loved ones are taken care of financially in the event of your death, you should shop around to see which companies can offer the cover you’re looking for. It’s important to consider things like superannuation, multiple salaries and any savings you have stashed away when working out the amount of cover you may need through life insurance. This could mean your loved ones may be able to live comfortably on less coverage.

Waiting periods

On certain types of policies, there’s a waiting period associated with making a claim which you can choose. These can vary from two weeks to two years for income protection insurance and up to 90 days for TPD and trauma cover, so it's important to do some research to locate the one that suits your needs.

What factors can impact the cost of my policy when buying life insurance?

Life insurance premiums in Australia vary widely from person to person due to a range of factors. These include:

  • Age: the younger you are, the less you’re likely to pay for your insurance. As you get older, you're more likely to develop health issues and the likelihood of you making a claim will increase, raising the price of your policy. Insurance companies will refuse to provide you with coverage if you’re looking to buy a policy over a certain age. 
  • Work and lifestyle: those working as firefighters, police officers or in the building and construction industry may find it harder to get approved for insurance coverage due to the risk associated with the professions. However, if they do manage to secure a policy, they'll likely pay more for their insurance. You'll also be asked about the types of pastimes you partake in. For example, if you're someone who smokes regularly or scuba dives, you may pay more than someone who sticks to indoor activities and doesn’t smoke.
  • Cover amount: working out how much your family will need to live on after you've passed away is one of the most significant decisions you'll make when buying life insurance. However, working out how much you need, rather than choosing the top amount, can save you money on your premiums. Providers can offer coverage from $100,000 without an upper limit for life cover, depending on your age and the type of policy you want to take out, with other types of insurance coming with maximum coverage amounts. Calculate your regular household costs, as well as any known future costs, and consider your super balance and any savings to help you determine an amount which can offer protection to you and your family. 
  • Medical history: you must disclose to your insurer any pre-existing conditions or significant medical problems, which will be factored into your premiums. This includes any chronic diseases that you or any members of your family may have experienced. Just like how your lifestyle choices might affect your ability to get insurance, a health condition can cause insurer to refuse to cover you, charge you more for premiums or offer coverage with specific exclusions.
  • Gender: women have a longer life expectancy than men, so they can expect to pay less for their policy. However, your gender is only one minor factor in the more extensive workings of how much you'll pay for your cover.

Frequently asked questions about buying life insurance

Is it a good idea to buy the cheapest life insurance policy?

Not always – while the cheapest life insurance policy may seem eye-catching, it may not always offer suitable cover for your needs. That’s why it’s important to compare not just the cost, but the coverage and other benefits, which you can do through Savvy today.

Do I get to choose who receives my life insurance payout?

Yes – you can choose who receives your life insurance payout. Policyholders often choose their spouse, partner, children or another close relative to receive their payout in the case of their death. If you’ve opted for your child to receive the payout, it’s important to remember they must be 18 at the time of your death to receive the money. If they aren’t, the funds will be held by a legal guardian until they reach the age of maturity. Whether life insurance benefits are taxable will depend on who they’re paid to, so it’s worth getting some advice if you aren’t sure.

What happens if my life insurance claim is rejected?

Your life insurance company may deny your claim if you’re requesting coverage for an excluded incident, such as suicide within the exclusion period or an accident or death caused by drugs or alcohol. If your life insurance is rejected for other reasons, your family should seek legal advice if they’re considering challenging the ruling.

Can I buy life insurance for my parents?

If you’re looking after your elderly parents, you may be able to buy life insurance on their behalf. All you need to do is get their written permission and ensure you prove that their death would financially impact you. If your parents are in poor health or suffering from dementia or Alzheimer's, you may still be able to buy a policy for them if you have power of attorney, but coverage may be difficult to secure due to their illness.

How do I make a claim under my life insurance policy?

If you’re making a claim, read your policy’s fine print, complete the claim form provided by your insurer and gather any documents you’ll need to substantiate your claim, such as a death or medical certificate. Once you’ve submitted your claim, it should take a few weeks to settle. However, the process can be a little different depending on the type of life insurance you buy and the insurer you’re going through, so it’s best to check your provider’s process when comparing through Savvy.

Do age limits apply to life insurance policies?

Yes – each life insurance policy will have two age limits: a maximum entry age (the oldest you can be to purchase a policy) and an expiry age (the age at which your coverage ceases). These will depend on your insurer, the type of policy you buy and other factors relating to your profile, but may align with the following:

  • Life cover: entry age up to 75, expiry age up to 100 (and older in some cases)
  • Income protection cover: entry age up to 60 to 65, expiry age up to 65 to 75 (most often 65)
  • TPD cover: entry age up to 75, expiry age up to 100
  • Trauma cover: entry age up to 65, expiry age up to 70 to 75 (most often 70)
Does life insurance cover me for COVID-19?

Most life insurance policies will pay out if you die or become terminally ill (life cover) or critically ill (trauma cover) because of COVID-19. However, it’s best to review the fine print to ensure the insurance policy you’ve chosen offers you coverage for any pandemic-related death or illness.

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Compare life insurance policies side-by-side

Through Savvy, you can consider a range of competitive life insurance policies from reputable insurers, whether you're after life, income protection, trauma or TPD cover. Get the ball rolling on comparing your available options today!

Disclaimer:

Savvy is partnered with Compare Club Australia Pty Ltd (AFS representative number 001279036) of Alternative Media Pty Ltd (AFS License number 486326) to provide readers with a variety of life insurance policies to compare. Savvy earns a commission from Compare Club each time a customer buys a life insurance policy via our website. We don’t arrange for products to be purchased from these brands directly, as all purchases are conducted via Compare Club.

Savvy does not compare all life insurance policies or providers currently operating in the market. Any advice presented above or on other pages is general in nature and doesn’t consider your personal or business objectives, needs or finances. It’s always important to consider whether advice is suitable for you before purchasing an insurance policy.

For any further information on the variety of insurers compared by Compare Club or how their business works, you can read their Financial Services Guide.

Life Insurance Banner - Elderly couple buying life insurance on their tablet

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